| The New Lithium “Gold Rush” Arrives… POWER UP
YOUR PROFITS There’s no doubt that the boom for lithium-ion batteries is upon us.
And with some of the best lithium properties in South America, little-known Millennial Lithium Corp. (ML.V; MLNLF.OB) is emerging as one of the best ways to profit from this trend. Dear John, The lithium-ion battery — if you’re like the majority of today’s consumers, you’re most familiar with it as the power source behind your smartphone.
But here are a couple of factoids to consider. According to a Goldman Sachs report, “a typical cell phone uses 5-7 grams of lithium carbonate equivalent (LCE) in its battery.” By comparison, according to that same report, a Tesla Model S battery electric vehicle (BEV) uses 63 kilograms of LCE.
Is there any wonder why Elon Musk — and every other manufacturer in the space — is worried about where they’ll find enough lithium? The Numbers Are Staggering The Goldman report estimates that demand for lithium carbonate will increase by 70,000 million tonnes (mt) for every 1% in BEV penetration into the overall vehicle market. Translation: Every 1% increase in BEV market share will require that five new lithium mines be built. And get this: Goldman is forecasting that the market for electric vehicles will grow more than 11 times over by 2025…and as a result annual demand for lithium could triple from 163,000 mt in 2015 to 470,000 mt by 2025.
Those numbers grow even more tantalizing when you realize that the country of Norway boasts a 37% penetration rate for EVs.
Assuming a future where the rest of the world merely catches up with Norway’s EV usage, that would imply a 2.6-million-tonne increase — or the equivalent of more than 180 new lithium mines per year — in the annual demand for lithium.
Even if these projections are wildly optimistic…even if EV demand is only a fraction of what they’re predicting…we’re in for a lithium rush that might dwarf anything we’ve ever seen in the resource market.
And that’s why Goldman is touting lithium as “the new gasoline.” Lithium Prices Are Already
Beginning To Skyrocket That reality is showing up on both the spot and long-term markets for lithium carbonate.
Spot prices have reached as high recently as $20,000/tonne, quadrupling from $5,000/tonne in 2015. Growth has also been robust on the long-term market, with contract prices more than doubling recently to $12,000/tonne from price levels of $5,500/tonne in 2016.
Further evidence of a bull market for lithium can be found in China, a key consumer of lithium carbonate. According to latest reports, LCE import prices hit record levels in China in April. The country’s LCE imports were up 33% year-over year during the month to 2,474 tonnes, and the price its paid for those imports averaged $11,552,66/tonne, a 63% year-over-year increase. Here’s what’s really exciting about this new bull market: Lithium accounts for only about 2% of the total costs of lithium-ion batteries.
Simply put, the price for lithium can continue to go through the roof, and it won’t have any measurable impact on battery manufacturers’ demand for this resource. Millennial Lithium Emerges
As The Potential Go-To Source With a land position spanning 25,000 hectares within the Argentinian corner of the “Lithium Triangle” formed by Chile, Argentina and Bolivia, Millennial Lithium has staked a prime position among the “salars” that provide a good portion of the world’s lithium. These brine-hosted sources of lithium are synonymous with low-cost mining. Costs for various mines from this area average between $3,000/tonne and $4,000/tonne. This is as little as half the costs of hard rock sources in Australia and China, where production costs average between $5,500/tonne and $6,000/tonne. What this means for investors is that, as the lithium revolution gathers force, the first companies “off the shelf” will be those low-cost producers that can profitably deliver supply into the market. In that environment, Millennial’s suite of brine-hosted lithium project becomes the perfect way to power up your profits on the boom in lithium-ion batteries. A Steady Stream Of News Flow Not content to sit on the sidelines and wait for the lithium boom to come to it, Millennial is now actively exploring its key projects with three drills working 24 hours a day, focusing on its flagship Pastos Grandes project.
The company is in the midst of an 11-hole drill program at Pastos Grandes to support previously generated geological and resource models for the project. In other words — important news is on the way right now. | 