Electric Metals market heating up as Electric Cars hit the road in 2010.

Image by Getty Images via @daylife

Mitsubishi contracts with Toshiba to supply Lithium Batteries and Toyota contracts Panasonic to supply lithium batteries as competitors jump into EV market!

As the Tesla, ForTwo, Nissan Leaf and Chevy Volt launch this year, investors are quickly realizing that,  each one of these new vehicles runs on Lithium batteries. Each one uses approximately 8 pounds of lithium, now coming to be known as the "electric metal"!

The Lithium market is heating up as the tide goes out on oil, and 2010 is the year everyone will remember as the real start of the lithium boom. With the advent of the electric vehicle market, China believes lithium will be the oil of the 21st century. They are not alone in that assumption. The worlds largest supplier of lithium, SQM of Chile, has already seen it's stock price sky rocket over the past two years and is, at this writing, looking to expand it's already large holdings in the lithium salars of Chile. There is, however, a growing segment of this market that has a huge upside for savvy investors. The Junior miners.


Our Top five Junior Lithium Miners in order:


1 .Salares Lithium (LIT-TSX)  -Conviction stock pick

Owns over 117,000 hectares (288,990 acres in the Atacama region of Chile, encompassing 7 Salars (brine lakes) nearby SQM operations. The project is called Salares 7.  50% of the worlds current lithium production comes from this area of Chile with the largest producer being SQM.

This is one of the best, pure play Lithium ventures anywhere today with a depth of resource now measured at over 300 meters in a region that already produces 50% of the worlds current lithium supply and is nearby the largest lithium producer in the world.

Salares Lithium wholly owns 100% of 5 of those Salars, which is unique in the industry and very important in South American mining. Many others "share" deposits on the same properties (that would be the equivalent of two people placing two separate straws in the same soft drink).

Salares now has a giant Lithium footprint, as large as anyone on the planet (read the article: Size matters ) They also have a very focused management team and institutional investors are in on this play. At this writing Sociedad Quimica y Minera S.A. (NYSE-SQM), the worlds largest producer of lithium carbonate (the main ingredient in any lithium battery) has shown specific interest in the properties of Salares Lithium prompting Salares to upgrade their property to the development stage this month. We think this company is a likely takeover target.

Click here for analyst opinions on Salares Lithium!

(UPDATE--- July 15 2010 - Salares swallowed by Talison of Australia, the #1 supplier of lithium to China)

2. TNR Gold Corp (TNR-TSX)

We think TNR is the "sleeper" in this space and is currently flying under the radar of most investors.  TNR Owns 16 gold, copper, Lithium, and REE properties in Nevada, Canada, Argentina and Ireland.

More importantly, TNR "owns 100% of International Lithium Corp"which it will spin off next month in an IPO.

ILC owns 9 Lithium brine properties in Argentina, Nevada, and Canada, while TNR will retain it's gold, copper and rare earth deposits in Canada and Ireland as well as one Lithium play in Argentina. TNR may actually be the best "short term" play in the sector as it prepares the IPO for International Lithium Corp. as owners of TNR stock will automatically own stock and warrants in International Lithium when it is spun out next month. (one share and one warrant for every 4 shares of TNR) Thereby owning "both" companies after the IPO next month.

Institutional Holders of TNR stock include some serious players:   Barrick Gold, Pinetree Capital, Tocqueville Fund, Solitario, and NovaGold.

Research notes on TNR gold Corp. 

3. Western Lithium USA (WLC-TSX)

WLC owns over 50,000 acres of proven, lithium reserves in Nevada. One of the only pure lithium plays in the USA with proven reserves. This is one of the worlds largest, proven Lithium deposits at 47 million tons, mine ready, located in mining friendly Nevada with quick access to buyers in North America.

On May 31st Western Lithium changed it's name to Western Lithium USA to more reflect it's intention to supply Lithium to that market.WLC should be part of every investors lithium portfolio.


4. Rodina Lithium (RM-TSX)  (formerly Rodina Minerals)

Besides it's recent acquisitions of Diablillos, Centenario and Ratones in the Salars of Argentina on the Puna Plateau, RM owns a substantial lithium property in Clayton Valley Nevada  Rodinia has 100% mineral rights to 50,440 acres in Nevada’s lithium-rich Clayton Valley in Esmeralda County approx 80 mi. from where Western Lithium is working, and is currently in the process of assessing the size, quality and processing alternatives of its Lithium Brine Project. Early estimates put the valley’s lithium deposits as high as 700 million kg, ranking it second only in size to the deposits found in Chile.

Rodina Lithium-RM is one of the top Lithium picks of Byron Capital Markets analyst, Dr. Jon Hykawy who is, arguably, one of the foremost Lithium experts in the market today! RM is also a favorite of the gold report.(theaureport.com)

5. Latin American Minerals Inc. (LAT-TSX)  

Besides gold, copper and silver, LAT owns a 17.4% stake in Lithium Americas Corp. (LAC) which has a big stake in the Salars on the Argentina side. LAT also owns rare earth properties (REE's). Lithium Americas properties include over 100,000 Hectares encompassing 5 salars (salt lakes) on the Argentina side of the Puna Plateau.You can buy LAT now (currently .15 cents) to own 17.4% of Lithium Americas,  (which we have done), or you can buy Lithium Americas (LAC) at the IPO price of $1.80

Strategic Investors in Lithium Americas already include:

• Magna International Inc.
• Mitsubishi Corporation
• PineTree Capital corp.

Tesla (seen on the left) has already launched it's North American IPO.Nissan has "pre-sold" 20,000 of it's new, lithium-ion powered Nissan "leaf" which launches in December, at a unit cost of $25,000. GM is ramping up for the launch of the Chevrolet "Volt" (right) in early 2011.

Tidbits:

The journal, MIT Technology Review published advancement in lithium air
batteries (also called lithium-metal-air batteries) for large scale applications.
Lithium-metal batteries approach the energy density of fuel cells without the plumbing
needed for these devices; in theory, the maximum energy density is more than 5,000 watt hours
per kilogram, or more than 10 times that of today's lithium-ion batteries. Lithium
metal-air batteries are also very lightweight because it's not necessary to carry a second
reactant.  
Lithium metal is "the holy-grail battery material," says Steven Visco, chief
technical officer and founder of PolyPlus

 

Energy research company Frost and Sullivan, says the battery market is set to grow massively.
The lithium-ion battery market for electric and hybrid vehicles is, he says, conservatively-estimated to be set to grow from 2,400 units in 2008 to 1.53 million units by 2015. "The world's dependence on oil will decline and will be replaced by other fuels, such as lithium batteries."


President Barack Obama has said he wants a million hybrid electric cars on America's roads by 2015.  At a groundbreaking ceremony for a new lithium-ion battery plant on Monday, Vice President Joe Biden said such factories could reduce US dependence on foreign oil and prevent disasters like the Deepwater Horizon oil leak in the Gulf of Mexico.
"This is the beginning of a revolution in the production of energy in the country,"said Biden.



Happy Retirefund!

HAP

Disclosure:  Accumulating Junior lithium stocks summer 2010.

• Demand for Lithium Is Poised to Take Off (nytimes.com)
• Our Journey Toward Public EV Quick-Charging Begins (wired.com)
• "Boston-Power Raises $60 Million, Seeks Stimulus Money In China" and related posts (techpulse360.com)
• Carbon Nanotube Electrodes Boost Power in Lithium Batteries, Study Says (cleantechies.com)
• Tesla Unveils Roadster 2.5 - a New Body and a Sexier Look (inhabitat.com)
• Tesla electric cars do 0-£1.3bn in a day with Elon Musk at the wheel (guardian.co.uk)
• Tesla Roadster - an Amazing Electric Sports Car! (athingforcars.com)
• Rodinia Minerals Inc. (TSX-V: RM) (OTCQX: RDNAF) Sets New Work Program to Further Test High-Grade Lithium-Potash Horizons at Salar de Diablillos (your-story.org)
• Running On Air (forbes.com)
• Lithium Battery Market 2010-2015 by Rick Mills -Aheadofthecurve

Hold on to your Loonies!

Last year we told you to "hold on to your Loonies" as the Canada buck was trading around .77 usd at the time. Needless to say, we told you so! This week both the National Post and RBC are telling you the same thing, forecasting that by the end of the second quarter, the Loonie will trade "above" the U.S. dollar.

There has even been a spike in put options of late which allow the buyers to sell Aussie dollars for the Canada buck (Loonie). As the world searches for more places to "stash their cash", Canada has been at the forefront. The soundest banking system on the planet (Four of the five major banks just reported profits above analysts expectations) coupled with many natural resources, makes Canada a good bet for foreign investors and with the latest Canadian budget, that outlook brightens further, as the Canadian Government has done away with restrictive bureaucracy that kept, especially, American V/C firms from investing in Canada. With those restrictions gone, more capital is looking to Canada for safety as well as innovation in energy, bio tech, mobile web technology and numerous other businesses.

Canada projects (and so do many economists around the world) that it will be first mature economy to emerge from deficit spending. As the largest supplier of oil to the United States, and with an abundance of Natural Gas, hydro power and recently wind power, Canada is well positioned in the energy sector, with the largest consumer of energy right next door.

Add to that the fact that Canada holds over 20% of the worlds fresh water supply while it's citizens make up only .03% of the worlds population, and the outlook becomes brighter still.
Oh yes, have I mentioned Canada is the #2 suppler of diamonds to the world, (the #1 supplier of "non-blood" diamonds) and is in the top 3 % of suppliers of Potash, gold, copper, nickel, uranium, platinum, etc. It's known reserves of natural gas is second only to the United States at present, but will probably take the number one spot as exploration ramps up for shale gas.

Even manufacturing is flying in Canada as Bombardier of Montreal takes on the Giants of Aerospace, Boeing and Lockheed Martin, at least in the regional jet space, while it's rail car division signs more new contracts in Europe and Asia for high speed rail in the $Billions. Ballard Power Systems, the granddaddy of fuel cell technology is signing contracts in Europe and especially India to supply those areas with clean tech portable power for their mobile web expansion. Ottawa based Wilan Technologies has signed 212 licenses for it's mobile web technology and on March 11th, it stands to reap even more rewards from it's patents as Apple and 18 other tech giants face a Markham hearing in a Texas court to determine how much they have infringed on Wilan's patents.

Magna International, Inc. is an Ontario, Canada based company, which produces a massive amount of auto parts for many players in the auto industry. It also has a new division, Magna E-Car Systems, that provides integration of components and systems, as well as the development and production of innovative complete-vehicle solutions, from engineering to turnkey systems, for all hybrid and electric vehicle programs around the world. Magna also manufactures other automotive systems, assemblies, modules, and products.

Encana is a major natural gas supplier, with huge investments in shale gas from Texas to New York, from Vancouver to Nova Scotia besides it's already extensive regular natural gas projects. Encana recently split into two entities, leaving most of it's oil business to a new company Cenovus a now lean oil player based in Calgary Alberta. As two separate entities since November 2009, these two companies figure to factor in to the North American energy market in a big way over the next decade.

TD Bank, Canada's second largest bank, is expanding into the U.S. market at a time when many U.S. banks are ripe for the taking, and it expects that it's U.S. arm may outpace it's Canadian system of 2,000 branches in the not too distant future. Currently, without that growth, it already stands at North America's 7th largest bank by capitalization.

In 9 out of the last 10 years, Canada has not only been in "the black" but has actually paid down debt in each of those years, while the rest of the G20 sank deeper. Even with this years deficit, caused by international events rather than domestic, Canada's "per capita" debt is less than half that of America.

The Loonie is outshining the usd for good reason. Natural Resources, Natural Gas, Oil, Aerospace, mobile web technology, Clean Tech, energy, auto, bio science and banking are only some of the strengths of the "True North strong and free", so as we said before, hold on to your Loonies, and reap the rewards of years of restraint and good management. Canada's investment landscape is becoming a lot less boring, and a lot more profitable.

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