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Lithium

U.S. Loosing Global Battery Arms Race that is Critically Dependent on Nickel, Cobalt and Lithium – by Simon Moores (Benchmark Mineral Intelligence – February 5, 2019)

  • Written Testimony of Simon Moores, Managing Director, Benchmark Mineral Intelligence
  • For: US Senate Committee on Energy and Natural Resources Committee
  • Hearing: Tuesday, February 5 2019, at 10:00a.m. Room 366, Dirksen Senate Office Building in Washington, DC.
  • Subject: Outlook for energy and minerals markets in the 116th Congress.

We are in the midst of a global battery arms race in which the US is presently a bystander.

Since my last testimony only 14 months ago, we have reached a new gear in this energy storage revolution which is now having a profound impact on supply chains and the raw materials that fuel it.

The advent of electric vehicles (EVs) and the emergence of battery energy storage has sparked a wave of lithium ion battery megafactories being built.

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Lithium Giant’s Landmark Deal Is Big Step to Battery ‘Dream’ – by Laura Millan Lombrana (Bloomberg News – January 31, 2019)

https://www.bloomberg.com/

The country holding the world’s largest reserves of lithium says it’s one step closer to becoming a manufacturing hub for rechargeable batteries used in electric vehicles.

Chile is hopeful that battery makers such as Samsung SDI and POSCO will start installing lithium processing plants in the country by the end of the year, according to Sebastian Sichel, executive vice president of government development agency Corfo. The agency recently reached a deal with top lithium miner Albemarle Corp. that will give battery makers access to cheaper lithium.

“We want manufacturers to get closer and closer to producing a complete battery in Chile — that’s our dream,” Sichel said in an interview in Santiago. “We don’t know if we’ll ever make vehicles, but we would like to at least see battery parts produced in Chile, maybe even the whole battery.”

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Lithium and cobalt – what to look for in 2019 – by Wood Mackenzie (Mining.com – January 30, 2019)

http://www.mining.com/

Last year saw perhaps less exuberance in the lithium sector. The muted response to the IPOs of industry majors Ganfeng and Livent (ex-FMC) probably best exemplified the lull in excitement. Meanwhile, stocks of already traded lithium companies also had a painful time of it in 2018.

For lithium spot prices in the Chinese domestic market, 2018 saw only one direction – down. Rising domestic supply, EV subsidy changes, and destocking all combined to send prices for 99.5% lithium carbonate from RMB160,000/t at the start of 2018 to RMB77,500/t by the end of the year.

Yet conversely, average prices for seaborne material – largely sold on contract basis – seemingly bucked the trend, with realised prices for SQM and Albermarle increasing up to Q3 2018.

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In the new lithium ‘Great Game,’ Germany edges out China in Bolivia (Channel News Asia – January 28, 2019)

https://www.channelnewsasia.com/

When Germany signed a deal last month to help Bolivia exploit its huge lithium reserves, it hailed the venture as a deepening of economic ties with the South American country. But it also gives Germany entry into the new “Great Game”, in which big powers like China are jostling across the globe for access to the prized electric battery metal.

UYUNI, Bolivia/BERLIN: When Germany signed a deal last month to help Bolivia exploit its huge lithium reserves, it hailed the venture as a deepening of economic ties with the South American country.

But it also gives Germany entry into the new “Great Game”, in which big powers like China are jostling across the globe for access to the prized electric battery metal.

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Explainer: SQM and Chile reach lithium deal, but Atacama water woes continue – by Dave Sherwood (Reuters U.S. – January 9, 2019)

https://www.reuters.com/

SANTIAGO (Reuters) – Chile’s environmental regulator this week approved a $25 million compliance plan by lithium miner SQM (SQMa.SN), ending a multi-year investigation by authorities that found the Chilean miner had overdrawn lithium-rich brine from the Atacama salt flat.

The case, now resolved, raised questions about how much brine and fresh water was left beneath the Atacama, and how long it would last. Those concerns, and others, still linger. Here’s why:

WHAT IS THE SALAR DE ATACAMA?

The Salar de Atacama is a high-altitude desert basin in northern Chile that, in 2017, supplied more than one-third of the world’s lithium, a key ingredient in the batteries that power cell phones and electric vehicles.

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Score One for the Flamingos in High-Altitude Fight for Lithium Supplies – by Laura Millan Lombrana (Bloomberg News – December 22, 2018)

https://www.bloomberg.com/

The Chilean government is taking on a U.S. mining company in a spat that could rattle the electric-car industry.

For the past nine months, a U.S. company that is the world’s largest producer of lithium — a key ingredient in electric-car batteries — has been locked in battle with the Chilean government over pricing issues, production quotas and environmental compliance. With no resolution in sight, the fight is sending tremors all the way up the electric vehicle supply chain that provides batteries to Tesla Inc., Nissan Motor Co., Bayerische Motoren Werke AG and other car makers.

The drama is playing out in the northern reaches of Chile’s Andes Mountains amid the arid and austere Atacama Desert, a vast, high-altitude bowl surrounded by snow-capped volcanic peaks named after ancient gods of the indigenous people. The U.S. company, Albemarle Corp., has taken over a massive salt-flats mine, pumping scarce briny water through dried-out salt marshes and lagoons to extract the prized mineral.

A dozen or so miles away, thick flocks of Andean flamingos feed peacefully in a lagoon teaming with tiny shrimp, as they have for countless millennia. But as mining activity surges, water tables are falling amid growing environmental concerns.

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UPDATE 1-Portugal sees first lithium licensing tender in 2019, wants refinery – by Sergio Goncalves (Reuters U.S. – December 18, 2018)

https://www.reuters.com/

LISBON, Dec 18 (Reuters) – Portugal expects to launch a tender for lithium exploration licences next year, the new secretary of state for energy said on Tuesday, confirming the general outlines of a plan devised under his predecessor, although with a slight delay.

In September, Joao Galamba’s predecessor Jorge Seguro Sanches said he wanted to launch the tender before the end of 2018 as part of a plan to make Portugal Europe’s top supplier of the metal for electric car batteries and meet an expected surge in global demand for lithium.

Galamba, who took over less than two months ago after a wider government reshuffle, also told Reuters the government will look at commitments to invest in a local lithium processing unit as part of the tender process.

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Building Fortune Heir Tim Roberts Picks A Lithium Winner – by Tim Treadgold (Forbes Magazine – December 17, 2018)

https://www.forbes.com/

Tim Treadgold has been writing about the mining and oil industries for more than 40 years.

Tim Roberts, one of the heirs to a multi-billion dollar fortune left by his builder father, the late John Roberts, has enjoyed his first significant win in the Australian mining industry thanks largely to the U.S.-based specialty chemical maker, Albemarle Corporation.

Through a private company, Kingfisher Capital, Roberts last month paid $21 million at an average price of $10.60 for slightly more than two million shares in Mineral Securities, a mining and engineering services company of which he was appointed a director two years ago.

Until making that investment Roberts owned just 6997 shares in Mineral Resources which mines iron ore and lithium as well as having a division which builds mineral processing plants.

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Germany secures access to world’s second-largest lithium deposit – by Cecilia Jamasmie (Mining.com – December 12, 2018)

http://www.mining.com/

Germany and Bolivia today sealed a partnership for the industrial use of lithium, a key component in the batteries that power electric cars and cell phones. ACI Systems will work with state-owned Bolivian Lithium Deposits (YLB) on installing four lithium plants in the Salar de Uyuni salt flats, which hold the world’s second-largest lithium deposit.

The joint venture also plans to build a factory for electric vehicle batteries in the country. While more than 80% of the lithium extracted will be exported to Germany, the company is said to be in talks with other European companies.

The partners expect to produce up to 40,000 tonnes of lithium hydroxide per year, beginning in 2022, over a period of 70 years. President Evo Morales sees a prosperous future for the impoverished nation, pinning his hopes on the rapid rise in the global price of the so-called white petroleum.

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What really powers your smartphone and electric car – by Lynsey Chutel (Quartz.com – December 8, 2018)

https://qz.com/

The rechargeable lithium-ion battery helps define our era. It powers our smartphones and electric cars, and promises a future where we’re better able to store renewable energy. It also requires lithium and cobalt, minerals that some of the world’s poorest countries happen to have in abundance.

That should be good news for all concerned, but mismanagement and graft—common in extractive industries—are making the latest mining boom looks uncomfortably like the bad old days of previous booms.

This week provided reminders of that. First, the Democratic Republic of Congo tripled its levies on cobalt, of which it has the world’s largest natural supply, in a move that could result in pricier smartphones and production slowdowns for electric-car makers. Also, HSBC released a report showing that the projected market share of electric vehicles will be smaller than first thought, due to the high price of lithium and cobalt amid soaring demand.

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Exclusive: Albemarle pushes Chile to reverse lithium quota decision – filings – by Dave Sherwood and Ernest Scheyder (Reuters U.S. – December 5, 2018)

https://www.reuters.com/

SANTIAGO/HOUSTON (Reuters) – Albemarle Corp (ALB.N) has launched an aggressive lobbying campaign after Chilean regulators denied its request to boost lithium output, stressing the company’s importance to Chile’s economy and workers, according to records reviewed by Reuters.

The behind-the-scenes moves come even as Albemarle has publicly brushed off worries from analysts and investors about rising regulatory pressure in Chile, home to the world’s largest reserves of lithium, a crucial ingredient in electric car batteries and mobile phones.

Ellen Lenny-Pessagno, who became Albemarle’s Chile country manager in October, met with the Chilean Nuclear Energy Commission (CCHEN) on Nov. 23 to discuss the rejection, according to filings with Chile’s lobbyist transparency website that have been previously unreported.

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High Risk-High Reward Lithium Bet Drives Argentina Mining Surge – by Laura Millan Lombrana and Jonathan Gilbert (Bloomberg News – December 5, 2018)

https://www.bloomberg.com/

High risk/high reward. That’s the bet being made by global lithium miners in Argentina who are brushing aside a recession, a currency crisis and political uncertainty in their hunger for the mineral that helps power electric cars.

Rising demand and limited supply have resulted in lithium prices tripling over four years. In response, companies have been scrambling to build new mines, putting Argentina and Chile, two of the world’s largest producers of the mineral, squarely in their sights.

But while Chile may be more economically stable, top producers there — Albemarle Corp. and Soc. Quimica y Minera de Chile SA — have struggled to obtain licenses to expand. Meanwhile, Argentina President Mauricio Macri is pushing a more pro-market agenda.

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Tianqi buys stake in lithium miner SQM from Nutrien for $4.1 billion – by Antonio De la Jara (Reuters U.S. – December 3, 2018)

https://www.reuters.com/

SANTIAGO (Reuters) – China’s Tianqi Lithium Corp (002466.SZ) has purchased a 23.77 percent share in Chilean lithium miner SQM (SQMa.SN) from Canadian fertilizer giant Nutrien (NTR.TO), the Chilean stock exchange said on Monday, for a total sale price of $4.066 billion.

The sale to Tianqi comes as Chinese companies increasingly scour the globe for the raw materials necessary to ramp up Chinese production of electric vehicles. Lithium is a key component in the batteries that power everything from cellphones to electric vehicles.

“A minority stake in SQM is great from our perspective, especially when we look at long term growth and expectations for the lithium industry,” said Ashley Ozols, business development manager for Tianqi, after the deal closed.

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Bolivia’s Almost Impossible Lithium Dream – by Laura Millan Lombrana (Bloomberg News – December 3, 2018)

https://www.bloomberg.com/

A small army of workers from cities and villages across Bolivia boards the buses for the last leg of a commute that can last days. The meandering, bumpy dirt roads, the thin air at high altitude, the ordeal of bringing labor into the blinding white plain of the world’s largest salt flat—all of this stands between anyone who dreams of retrieving Bolivia’s lithium riches and turning it into electric-car batteries.

These workers will spend two weeks at the Uyuni salt flat in the southern tip of Bolivia before they return home for a seven-day rest. They are attempting to build a world-class lithium mine on top of the Andes mountains, about 12,000 feet above sea level at the heart of landlocked Bolivia. The nearest port is at least 500 kilometers and a border crossing away.

From above, this vast area appears so white it gets mistaken for a giant snow plain. The salt crystallizes in the dry season, forming millions of tile-looking hexagons that span an area as large as Connecticut. During the wet season, it’s covered by a thin layer of water that forms a giant mirror, reflecting the sky so neatly that the line of the horizon disappears. The visual effect draws thousands of visitors and the Dakar Rally every year, making it Bolivia’s top tourist destination.

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Lithium producers race to dominate South American output: Roskill – by Ben Kilbey (S&P Global Platts – November 26, 2018)

https://www.spglobal.com/

London — There is a battle to be the “supreme” lithium producer in South America, with Chile now facing competition from other countries on the continent, research outlet Roskill Information Services said Monday.

Speaking at the annual Mines & Money exhibition in London, Robert Baylis, managing director of Roskill, said the global shift away from carbon to renewables and electric was creating a massive demand boost for lithium.

Baylis said he sees lithium demand growing at around 30% annually, from around 94,000 mt in 2018 to 1 million mt and above from the late 2020s. However, he cautioned that recent price volatility and weakness could be putting off increased investment on the supply side.

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