Natural gas is too "unstable" to use on our roads and highways where
millions of cars and trucks are subject to the millions of traffic
accidents. From a safety perspective alone, natural gas vehicles should
not and cannot be allowed on our roads. There are simply too many
uncontrollable variables.
Natural gas can however, power the
transportation of the future as feed stock for electrical power
generation. Because natural gas is so abundant, it only makes commons
sense that electric power plants will use more and more natural gas as
their feed stock over time. As this abundant source of power generation
comes on stream, look to invest in the companies that stand to benefit
from this game changer.
Duke Energy (DUK), Progress Energy (PREX.PK) and others are all good bets as is laid out by theStreet.com (See their top ten list for 2012)
Electric power storage is also a great place to take a long term view.
There companies in that space looking for fuel cell solutions (large
fuel cell stacks that can burn nat gas) Ballard Power (BLDP), Plug Power (PLUG), and Hydrogenics (HYGS)
are all pursuing such a solution. However, it is the feed stock of the
future electric car that interests me most, and that is Lithium.
As
Lithium becomes more and more the "go to" source for new battery
technologies, from your iphone and laptop, to golf carts, electric motor
cycles, cars and large storage facilities, look to the miners who
produce, or will produce, lithium carbonate from two different sources,
hard rock (pegmatite) and lithium brines or clays. Let me explain.
The largest supplier of Lithium today is Sociedad Qumica y Minera de Chile S.A. (SQM)
which produces Lithium as a byproduct of its massive Potash operations.
As with other large miners, SQM sells it's lithium on a spot market
(there is currently no futures market for lithium, however this could
change in the coming years)
Now electric battery manufacturers and
car makers require a steady stream of lithium carbonate for their
manufacturing processes so as not to interrupt production. To date,
suppliers such as SQM, FMC et al have refused to sign
contracts to supply a continuous, uninterrupted supply of product to
manufacturers. This is mainly because, even though brine production is
the most economical way to produce lithium, it is more sporadic than
spodomen production, due to the natural drying out process supplied by
the sun, that makes it more economical in the first place.
Australian producer Talison Lithium (TLTHF.PK)
(TLH-T) is the largest, pure lithium producer on the planet, and its
spodomen production from its Greenbushes operation in Western Australia,
is the richest hard rock deposit on the planet. Talison supplies over
300 customers with product and is the largest supplier to the growing
Chinese market, due to its ability for continuous production and its
proximity China. Talison also boasts a very large brine deposit in South
America due to its purchase of Salares Lithium in 2010. In 2012 Talison
reports a 25% increase in the price of lithium this year alone (2012). (click to enlarge) FMC Corporation (FMC)
is another large producer based in South America, with brine production
as a byproduct of other operations such as potash. As with SQM, lithium
is only a part of its total operations and as potash becomes more
important as agriculture attempts to feed a hungry world, its share
price looks attractive as well.
As the lithium market grows, you should not ignore the juniors
who have popped up over the past five years to take advantage of large
deposits which may at some point, be quite productive or gain the notice
of larger producers as consolidation takes place, as it so often does
in young, growing markets.
In this space I like both Western Lithium (WLCDF.PK)(WLC-T) for its large, Kings Valley clay deposit in mining friendly Nevada and Rodinia Lithium (RDNAF.PK)
(RM-T) as it owns three of the top 20 lithium brine deposits on the
planet. If there is a future consolidation in the industry, these two
should be tops on the majors lists.
In the "Battery" tech area I like A123 Systems (AONE).
At only .50c per share this high tech battery maker has been hammered
this year, well below where I think it should trade. At .50c per share,
it is one of the best speculative penny stocks out there.
The
above chart shows some of the other companies working in this field and
as you can see from the chart, Lithium is a common denominator in
battery development.
UPDATE: Aug 24th 2012
Rockwood Holdings (ROC) made an offer for Talison Lithium of $724 Million driving Talison shares up by 53% since yesterdayès close. We have cashed out our position in Talison with 110% gain. Looking for an entry point into ROC now as it strengthens itès already substantial position as a world leader in the production of Lithium!
Perth, Western Australia, January 25, 2012 – Talison Lithium Limited (“Talison” or the “Company”) (TSX:TLH| US: TLTHF) announced todaythat, Frank Wheatley, Executive Director Corporate Affairs and Strategy will be presenting at the Merriman Capital Investor Summit 2012. The conference will be held in New York City on February 1, 2012.
The Merriman Capital Investor Summit 2012 is dedicated to fast-growing companies in industry sectors such as clean-tech and clean energy, biotechnology, and resources including critical metals and rare earths. The conference features corporate presentations and individual meetings.
The presentation will be webcast, and a link to the webcast will be available on Talison’s website at www.talisonlithium.com.
For more information about the conference or to schedule a one-on-one meeting with Mr. Wheatley, please contact Talison’s investor relations representative listed below.
Talison is a leading global producer of lithium. Talison mines and processes the lithium bearing mineral spodumene at the Greenbushes Lithium Operations in Western Australia. In addition, Talison explores for lithium at the Salares 7 lithium project made up of seven salars (brine lakes and surrounding concessions) located in Region III, Chile. Talison has an extensive, well established global customer network and a leading position in the growing Chinese market.
Editors note:
Talison Lithium is the largest pure lithium producer in the worlde today, supplying over 300 customers, mostly in China, with Lithium. This year (2012) Talison negotiated a price increase for it's lithium production of 15%.
Image via WikipediaPeak oil! We've debated that term since the 1970's oil shocks. Back then some experts were predicting peak oil by the turn of the 21st century. Some said 2010, others as far out as 2030. However, according to the IEA, we passed the date for peak oil almost 5 years ago, in 2006. According to other distinguished scientists, who peer reviewed the IEA data, in Stockhold Sweden, even the IEA data is somewhat skewed toward the positive, indicating a dirth of oil is already upon us, and forshadowing prices that will make 2011 look like the good old days of cheap oil.
Review the video for yourself and make your own conclusions!
Then, invest accordingly.
Solid oil plays in the medium to long term.( We like SuncorSU and CenovusCVE)
Alternatives like wind, solar, nuclear, fuel cells (we like BallardBLD)
And lithium, (we like TalisonTLH, RodiniaRM and TNRGoldTNR) in the long term!
NEWS RELEASE
VANCOUVER, August 13, 2010 – Salares Lithium Inc. (TSXV: LIT) (“Salares”) and Talison Lithium Limited (“Talison”) are pleased to announce the completion of due diligence and execution of a definitive Arrangement Agreement (“Agreement”) for the merger of their respective lithium assets. For details of the proposed merger please see the joint news releases dated August 9, 2010 and July 15, 2010 which are filed on SEDAR at www.sedar.com.
The execution of the Agreement clears the way for Salares shareholders to vote on and
approve the merger at a special meeting of shareholders to be held on September 16, 2010.
The completion of the proposed merger is anticipated to be implemented by the end of
September, 2010, subject to the parties obtaining all necessary approvals and satisfaction of
other conditions.
A presentation of the transaction highlights can be accessed at the Salares and Talison
websites.
For further information please contact:
Investors
Todd Hilditch
President and CEO
Salares Lithium Inc.
Tel: (604) 443-3831
www.salareslithium.com
Peter Oliver
CEO
Talison Lithium Limited
Tel: +61 8 9263 5555
www.talisonlithium.com
Media
Kim O’Halloran
Vice President, Corporation Communication
FD
kim.ohalloran@fd.com
Tel: (312) 553-6733
Recent articles: Salares shares will double on merger with Talison Conviction stock pick - Salares Lithium Electric metals heat up - 5 stocks to consider.
Lithium (Li), the first of the alkali group of metals, was discovered (1817, Sweden) by Johan August Arfvedson and named for the Greek lithos, “stone.” A soft, silvery metal, it has many uses, including the production of glass, lithium batteries, and a strong, light alloy with aluminum for airplanes. Lithium carbonate is used in the treatment of mental illness, and an unknown amount is used as lithium hydride in the production of nuclear weapons.
Besides being used in most mobile web smart phones, laptops and ipads etc, Lithium Ion Batteries are the best technology for electric, plug in cars according to industry insiders and mining companies are now rushing to fill a void in an industry that is still in it's infancy, but is about to explode. That is the electric car industry.
As Warren Buffet points out, "In 20 years all cars will be electric"! Obviously that is one of the reasons Warren invested last year in Chinese car maker BYD.
However, the story here is Lithium mining, where it is mined, and And how it is mined. The Nickel Hydride battery, currently used in many hybrid vehicles, is grossly insufficient to power electric plug in vehicles (EVs) and, until now, this has been a major road block in developing EVs that can compete with the gasoline engine or Hybrid technology. If you review all of the battery blogs, and science and energy sites, it becomes clear that thousands of scientists and technicians around the world are working on Lithium batteries. Whether it is lithium vanadium phosphate that BYD Company Ltd. (BYDDF.PK) in China is researching, Lithium Ion, Lithium cadmium, Lithium Manganese, Lithium polymer or Lithium iron phosphate, the keyword in new battery technology is overwhelmingly, "Lithium"!
Lithium is also currently used in a number of applications including as a power source for mobile web devices (smart phone batteries - which are expected to triple by 2012), heat resistant glass and ceramics, Health care (Lithium based mood stabilizing drugs), and Lithium batteries for EVs, which may outdistance their closest competitor, Nickel Hydride batteries, in pure power, by a factor of 10. Lithium is also used nuclear energy and lithium hypochlorite is used extensively in cleaning swimming pools. There are truly many, varied uses for this valuable commodity.
Lithium is soft enough to be cut with a knife, and it is the lightest of the metals of the periodic table. It also has a low density (approximately 0.534 g/cm3) and thus will float on water, with which it reacts easily. It is most easily mined from Salar or salt lakes, mostly found in Bolivia and Chile.Lithium salts are extracted from the water of mineral springs, brine pools and brine deposits. It can also be mined from rock but that is more difficult and more expensive. Canadian and American companies are currently ramping up their exploration for this products which sells for between $4,000 and $5,000 per ton. That price is "today's price" before the electric car boom has even started!
Major car manufacturers including Toyota and Magna International have already invested in Lithium plays so as to secure future supply. Panasonic, which is Toyota's supplier of Nickel hydride batteries for it's successful Prius, recently bought Sanyo, the worlds foremost developer of Li-ion batteries. That should have huge implications for the industry.
The Chevrolet Volt, due out next year, will run on lithium manganese oxide batteries. These developments, however are just the beginning of what looks to be one of the great bull markets of this decade, and beyond. Lithium Ion Batteries, and eventually, Lithium Air batteries will require the world to seek out as many Lithium deposits as can be developed, and the quicker, the better.
The oil boom of the early 20th century is about to be replaced by a Lithium boom and if you are a Canadian investor you may be able to get in on the ground floor of some of these Junior miners currently busting their buts to stake claims in Lithium from Northern Canada to Bolivia, (which, incidentally, has about 50% of the worlds known deposits, but is one of the more hostile political environments in which to invest.)
However it is the country of Chile which actually produces the most Lithium currently and Juniors are crawling all over the Chilean Salar flats and staking their Lithium Mine claims at this writing. The majority of the world's lithium production comes from salars, or salt lakes, where prospective lithium mineralization is generally hosted in brine horizons. One of the Lithium pure plays in Chile is actually a Canadian Junior. Salares Lithium, (TSX-V LIT) The company has a large land package in the most prolific lithium brine reserve region globally - controlling 119,227 hectares in the Puna Plateau.
The area has extensive regional infrastructure. The main access to the Cauchari-Olaroz properties from San Salvador de Jujuy is via paved national highways. These highways carry significant truck traffic, transporting borate products from various salars in northern Argentina. Access to the interior of the Cauchari-Olaroz properties is possible through a gravel road, which skirts the west side of the salars and is used by borate producers.
"Salares Lithium is an exceptionally rare opportunity for a pure play exposure within the Chilean lithium exploration arena. The company represents one of the largest land and pure salar concession packages in the lithium exploration sector and has historic sampling returning lithium and potassium in all seven of its salares with grades up to 1,080 ppm lithium and 10,800 ppm potassium. A unique value proposition for this company is that it controls 100% of five salares clustered within 155 km’s, resulting in no severed ownership, as is quite common in the Argentine lakes."
This from the Energy Report:
Although the lithium space, in general, got a little bit too excited, there are a few gems. Salares Lithium is a great story. - The Energy Report with Marin Katusa (03/04/10) "Salares Lithium Inc. is currently on our watch list as it has one of the largest brine lake concession packages in Chile, which is the world's largest lithium producer. They have five brine lakes clustered within 155 kilometers, of which they control 100% of the interest with their Chilean partner." - The Energy Report Interview with Siddarth Rajeev (02/25/10)
This from Byron Capital Markets report:
. . .This is one of the most promising land packages we have seen; the claims were obtained for what we believe to be reasonable consideration, and, most importantly, Salares Lithium holds 100% of the land on the most promising lake beds." -JON HYKAWY, BYRON CAPITAL MARKETS (03/05/10)
Salares recently appointed Dr. Ian Hutcheon, PHD, to their advisory board. He is a professor Emeritus in Geology and Geo physics at the University of Calgary and retains an active research program.
According to the Salares website,
"His research has focused on water--rock reactions, geochemistry, monitoring field recovery processes, and diagenesis of clastic and carbonate rocks. Past research has included the study of the effect of diagenesis on reservoir properties. On-going research integrates chemical and isotopic data for shallow ground water to understand the controls on the distribution of elements and minerals in near-surface environments."
Salares is only one of the companies in the chase, but for me, it has the most interesting story. It's claim encompasses 7 Salars or salt lakes covering 120,000 hectares. The first of these, Isla de la Isla, encompasses over 16,000 Hectares. On March 8th the company reported that Geodata completed a transient electromagnetic survey ("TEM") on the northern portion of the Salar de la Isla, the results of which are posted at Marketwire. It is only one of the 7 Salars owned by Salares. As a side note, I am told that some heavy hitters in the Vancouver investment community are backing Salares Lithium.
In other Lithium news, Lithium Americas Corp is planning an IPO on the TSX in the coming months. It received private investments from auto companies Magna International Inc. and Mitsubishi Corp., which are looking to secure lithium supply because of its use in hybrid car batteries. (Disclosure: no position)
The Lithium chase is becoming a serious bull run as companies are pulling out all the stops to ensure a piece of this growing, 21st century pie. The pie is still hot, and hasn't been cut yet. That will come when some of the front runners begin producing and get swallowed up by larger players.
In the interests of disclosure, I wanted a small piece of that pie so I bought some LIT yesterday and again today. It is speculative, but the upside potential is staggering!!
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