Portofino receives encouraging results from Yergo lithium brine project in Argentina

Portofino Resources (TSXV:POR) made public this week initial sampling results from its Yergo lithium brine project, located at the Aparejos salar in the province of Catamarca, northwestern Argentina.

In a press release, Portofino said that the exploration program consisted of surface and near-surface brine sampling and geological mapping. “Hand augers were utilized to obtain the brine samples from surface to a maximum depth of 1.3 meters. A total of 22 locations across the property were sampled within the project concessions with samples returning values of up to 373 mg/L lithium, and up to 8,001 mg/L potassium. In all, the analyses for the 22 sample sites averaged 224.4 mg/L Li, 4,878 mg/L K and 184.4 mg/L magnesium,” the release states.

The 2,932-hectare Yergo project encompasses the entire Aparejos salar and is located in the southern part of the “Lithium Triangle”

The Vancouver-based company explained that due to the unusually high levels of water in the salar, most of the sample sites are located in the southeast portion of the property. The 16 "southeast corner" sample sites averaged 278.1 mg/L Li, 6,091 mg/L K and 86.2 mg/L Mg and their analyses also indicated low Mg:Li ratios (0.4 avg).

In Portofino’s view, due to the proximity of the salars comprising Neo Lithium's 3Q project and Portofino's Yergo project, it is likely that they have experienced similar geological histories and are similarly enriched in lithium and potassium as a result of their common evaporitic climate and local geology.

“We are encouraged with these very good, initial lithium and potassium sample results combined with extremely low magnesium/lithium ratios,” David Tafel, the firm’s CEO, said in the media brief. “As soon as weather permits, our geological team will continue their exploration work to follow up on the potential surface extent of the mineralization.”

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World’s No. 2 lithium miner SQM sees demand growing by 17% this year

Chile’s Chemical and Mining Society (SQM), the world’s second largest producer of lithium, expects demand for key component in the batteries that power electric vehicles and cell phones to grow at “double-digit rates” this year.

Reporting quarterly earnings, the Chilean miner said that despite prices being affected by new supply entering the market, the commodity will remain strong thanks to rising demand.

SQM believes more supply for lithium carbonate and lithium hydroxide is needed and that demand for these products will continue to grow at “double-digit rates in the future”

The company believes lithium consumption could grow about 17% in 2019 to at least 315,000 tonnes, compared to the less than 260,000 tonnes it totalled last year.

SQM, however, saw earnings for the first three month of the year drop by nearly one-third due to the slump in lithium prices, but also higher royalties at its operations in Chile, considered to be the highest in the world.

Chief executive Ricardo Ramos said the company, which is expanding its lithium carbonate and lithium hydroxide capacity, sees operational flexibility as the key component of its strategy.

SQM last year struck a deal with the government to more than triple production by 2025 in exchange for paying sharply higher royalties and offering discounted lithium to domestic value-added producers of battery components.

The company expects to produce 60,000 tonnes of lithium this year, with sales volumes reaching between 45,000 and 50,000 tonnes.

By 2020, SQM predicts that sales volumes would jump 30% over 2019, reaching approximately 65,000 tonnes.

Once the company completes an ongoing $400 million-plant expansion, it expects to produce as much as 180,000 tonnes of lithium carbonate from its Salar de Atacama operations in Chile, overtaking US-based Albemarle as the world's top lithium miner by 2022.

Chile, which holds about 52% of the world’s known lithium reserves, last year lost its top lithium producer crown to Australia.

The country, however, is working on reversing that situation. It predicts that lithium will soon become its second largest mining asset, behind copper. The commodity is currently the country's fourth biggest export.

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Zambia’s just deepened worries of sinking global copper output

Zambia’s Chamber of Mines delivered Thursdays further signs of a major global undersupply of copper about to hit the market by announcing that the country’s output of the metal could be as much as 100,000 tonnes lower than last year.

The industry lobby group attributed the expected drop in production to changes to mining taxes introduced in January, which is driving companies to cut output.

“The new tax regime forced miners to do the unthinkable – cut production – because many cannot afford to continue producing as before,” it said in a statement.

Zambia, Africa’s second largest copper producer, churned out 861,946 tonnes of the metal last year. In the first three months of this year, the nation’s copper output fell by 11.3% to 195,244 tonnes, compared to the previous quarter, the Bank of Zambia said earlier this week.

Copper output in Africa’s second largest producer could decline by as much as 100,000 tonnes this year, adding to recent, sharp declines at the world’s main producing nations.

The world’s main copper producing nations have been showing output declines this year, according to the latest monthly bulletin from the International Copper Study Group (ICSG).

Global production declined 2.4% in February 2019, when compared to the same month last year, with 1,515kt (19,749ktpa) of contained copper produced globally.

Chile, the world’s No.1 producer of the metal, led the pack with output down 7.1 % y/y to 415.9kt (5,412ktpa) while Peru, the second main global producer, saw its output fell by 5.1% y/y to 176.1kt (2,296ktpa).

Despite weaker copper production so far this year, ICSG data indicates a small surplus in February of 74kt with refined usage down 14% y/y, totalling 1,758kt (22,917ktpa).

Industry analysts at CRU believe that is undeniable that global demand for copper will soon surpass supply, the world may not need as many new mines as originally forecast.

Over the past year there has been board approval for several high-profile expansions and new projects that are due on-stream over the next five years.

CRU says the coming online of major projects, including Anglo American’s Quellaveco (2022), Teck Resources’ Quebrada Blanca expansion (2021) and First Quantum’s Cobre Panama (already in production) should momentarily eliminate the gap between supply and demand.

The research group now expects 900,000 tonnes a year more mine copper supply by the early 2020s than at this time in 2018. 

The EV effect

While the effect on copper demand from the electric vehicles (EVs) sector is expected to be important, the consensus is that it will not meaningfully impact on demand until the second half of the 2020s, CRU says.

The red metal is a key component in the lithium-ion batteries used in EVs, as well as power inverters and in the charging infrastructure needed to keep them running.

Data released by the International Copper Association (ICA), an industry-funded body, shows more than 40 million charging ports will be needed over the next decade, consuming an extra 100,000 tonnes of copper a year by 2027.

Zambia just deepened worries of sinking global copper output

All types of EVs require copper. It is used in batteries, windings, rotors, wiring, busbars and charging infrastructure. (Source Research commissioned by the International Copper Association (ICA).)

From those stations, at least 3 million will be built in China by 2030, according to the study.

Consumption from the car industry will also weigh on demand, but later. An average gasoline-powered car uses about 20 kg of copper, mainly as wiring. A hybrid needs about 40 kg and a fully electric car has roughly 80 kg of copper (176 pounds).

Zambia just deepened worries of sinking global copper output

Copper demand will be substantially impacted by the growing market for electric vehicles (EVs) over the next decade. (Source Research commissioned by the International Copper Association (ICA).)

It means that, in the next decade, global copper demand will increase between 3 and 5 million tonnes, experts predict. Once electric vehicles become popular, they estimate demand to reach 11,000,000 tonnes of new copper for EV’s alone.

Copper is also a key element in green technologies and renewables, which despite being adopted at a fast pace, they still represent only a minor percentage of the world’s total energy production.

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BHP more bullish on long-term EVs prospects

World’s largest miner BHP (ASX, NYSE: BHP) has lifted its forecasts for the global adoption and sales of electric vehicles (EVs), but warns the electrification of the transport sector will proceed only as fast as the development of charging infrastructure.

It now estimates that at least 132 million EVs will be on the world's roads in 2035, and at least 561 million in the middle of the century. These numbers are its "low-case" forecasts, and it also suggested take-up could be higher.

By 2050, BHP expects more than one in four light vehicles on the world's roads to be electric, or 27%, up from its earlier forecast of 21%.

Huw McKay, BHP’s vice president, market analysis and economics, said Tuesday the company estimates EVs comprising at least 7% of the world's light vehicle fleet in 2035, up from 5% in previous estimations.

By 2050, the giant mining company expects more than one in four light vehicles on the world's roads to be EVs, or 27%, up from its earlier forecast of 21%.

McKay attributed the new estimates to declining battery costs and rising interest among automakers, particularly in China.

"Globally established automakers and China's up-and-coming indigenous firms are embracing EVs, with model availability increasing steadily and many self-imposed sales targets instituted," he wrote.

BHP more bullish on long-term EVs prospects

BHP, already the world's second-biggest listed copper miner, has been taken steps towards increasing its presence in the red metal sector and other battery metals markets as of late.

Copper is a key component of the lithium-ion batteries used in the electric vehicles, as well as power inverters and in the charging infrastructure needed to keep them running.

It has also revealed plans to transform itself into the world’s biggest suppliers of nickel sulphate — another key component in lithium-ion batteries that power EVs.

Only last week, chief executive Andrew Mackenzie reaffirmed BHP’s commitment to supply the EV markets by announcing it would not divest its Nickel West operation as previously planned.

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Lithium Australia achieves high-purity lithium phosphate from waste materials

Following the development of a process to generate lithium phosphate from waste materials, Lithium Australia (ASX: LIT) announced this week that its experts have now developed a technique for removing impurities from the lithium phosphate resulting in an exceptionally high-purity refined product.

In a press release, the Perth-based company said that the product is suitable for the manufacture of lithium-ion batteries and, in particular, those with lithium iron phosphate or LFP chemistry.

The company needed to achieve a high-purity product for its partner, Chinese battery producer DLG

Even though Lithium Australia was able to produce LFP batteries from unrefined lithium phosphate, the firm said that the refining process was developed to ensure consistency of quality for the production of high-performance LFP batteries.

“The refined lithium phosphate was used to manufacture cathode powder and subsequently LFP coin cells which were then subjected to a standard testing regime and the results compared with industry benchmarks,” the media statement reads. “The results indicate the refined lithium phosphate is an ideal component for the manufacture of high-performance LFP cathode powders.”

According to the Australian company, the lithium phosphate refining process is cheap and provides the means to produce high-purity materials with consistent quality, something that was paramount for its team as it has partnered with Chinese battery producer DLG to commercialize cathode powder.

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Lithium expert dismisses oversupply forecasts

The possibility of an oversupply of lithium chemical is a myth, the president of California-based Global Lithium, Joe Lowry, said this week.

Addressing the audience at the conference Paydirt 2019 Latin America Downunder, Lowry blamed the spread of such a 'myth’ on ‘big bank’ analysts and the Chilean regulator CORFO.

In Lowry's view, there have been misunderstandings regarding CORFO's reports related to its revised agreements allowing Albemarle and SQM to produce more material from the Atacama brine resource.

"The reality is increasing production quickly is not so easy,” he said.

Global Lithium predicts that the industry will need to inject $12 billion within five years to have a chance of meeting demand.

The executive predicts that the ‘Big Four’ global lithium producers, SQM, Albemarle, Ganfeng and Tianqi, would not be able to meet the lithium demand forecasted for 2025 on their own.

“Overall, the industry faces a lack of financing and needs to inject more than $12 billion within five years to have a chance of meeting demand,” he said. “This requirement is exacerbated further by known and emerging failures in lithium start-ups which have demonstrated a lack of necessary skillsets – high profile failures that have discouraged sector investment."

On the issue of source, the Global Lithium executive called for a more balanced debate, saying analysts’ predictions of the dominance of hard rock lithium were both incorrect and incomplete.

"Neither lithium source – hard rock or brine – will dominate the future,” Lowry told those gathered in Perth, Western Australia. “It will be cathode selection decisions that will drive product choice. Any price issue will be defined more by the actual production cost curve at the time – but expect prices to be much firmer going forward.”

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Tesla is turning rivals into roadkill – even in China

Tesla is turning rivals into roadkill – even in China

Image by Brad Holt on Flickr

Elon Musk has no shortage of detractors – and judging by the tone struck by some of them, that’s not nearly a strong enough word.

Neither does the Tesla CEO have a shortage of short sellers, and every so often long sellers get in on the action too. Bears turn bulls with gusto and bulls turn bears with alacrity.

Musk frequently muddies the waters himself, making outlandish – and sometimes ludicrous claims for his current and future vehicles. And the tweets. The tweets. The reckless tweets.

The result of which is that those those who want to make a sober assessment of the company have few places to go.

On a MWh-basis the Muskmobile is not just shaming US and European competitors, but also the 486 EV manufacturers registered in China

So how does the rubber really hit the road for Tesla?

Adamas Intelligence tracks the battery capacity (and the metals used in them) of electric vehicles sold in more than 80 countries around the world, representing more than 90% of the global EV market.

The numbers are based on electric vehicle registrations including hybrids, not sales projections, production forecasts, thumbsuck extrapolations, or crystal balling that keep so many Tesla followers busy on Twitter and elsewhere.

The latest report by Toronto-based Adamas on global EV battery deployment in passenger vehicles should make Tesla bulls’ eyes water.

Tesla is simply miles ahead of the competition.

On a MWh-basis the Muskmobile is not just shaming US and European competitors, but also the 486 – yes, four-hundred-and-eighty-six – EV manufacturers registered in China.

In March this year Tesla deployed more battery power than its next four biggest rivals combined. That includes no.2 BYD (Build Your Dream) backed by Warren Buffett as long ago as 2008, which Tesla beat on a 2:1 basis (I'm only mentioning BYD because who'd ever thought the Sage of Omaha could be caught in the Musk reality distortion zone).  

Tesla is making roadkill of competitors – even in China

Tesla also outcelled (that’s a word now) state-owned giant BAIC's electric car company BJEV by a factor of four, despite Beijing’s helping hand lifting annual growth rates at the unit to beyond 250%.

At 2,889 MWh the California company comes close to equalling the combined total of the scores of manufacturers – include some big names like Ford, Mercedes-Benz and Volkswagen – outside the top 10.

Tesla’s outperformance also comes despite the fact that the combined MWh in the batteries of the Model X and S deployed in March, declined by more than 40%. 

The Model 3 had to lead the charge increasing battery power out on the road by 773% year over year.

The combined MWhours in the batteries of the Model X and S deployed in March, declined by more than 40%

Granted, Teslas have always had bigger batteries than competitor cars to help with fast-charging and reduce the number one anxiety of first time EV buyers – range.

But battery sizes have been growing across different makes with the sales-weighted average capacity 55% higher in March compared to 2018 according to Adamas.

China is actively encouraging this trend, earlier this year eliminating subsidies for vehicles with a range below 250km (155mi) entirely.

March 2019 was clearly hot sales month for Tesla, but the company’s had better ones.

In March 2018 Tesla employed 45% of the battery power among the top 10, a higher share than this year. And in September last year Tesla came up just short – a mere 39MWh – of outdoing the rest of the top 10 global EV manufacturers together.

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Rio Tinto plans to start mining lithium in Serbia by 2023

Global miner Rio Tinto (ASX, LON:RIO) may be ready to start mining lithium from its project in Jadar, Serbia in four years, but no decision will be made until the end of 2020, when the company expects to have completed a study on the deposit.

The asset, near the town of Loznica, in western Serbia, gives Rio Tinto an option to supply the world’s electrification needs, chief executive Jean-Sebastien Jacques said Tuesday at a mining conference.

The executive noted development at the giant deposit of jadarite, a lithium-containing mineral unique to Serbia, was in a preliminary stage. Ongoing studies are part of the pre-feasibility stage for evaluation of the technical and economic viability of the project, Jacques noted.

Discovered in 2004, Jadar contains boron and lithium in high concentrations, placing it among largest lithium deposits in the world.

"There are 26 steps to be able to extract the lithium," he said, adding that, while pricing was an issue, the company was becoming more comfortable with the lithium market.

Discovered in 2004, Jadar contains boron and lithium in high concentrations, placing it among largest lithium deposits in the world, according to Rio Tinto.

Since the beginning of the project, Rio Tinto has been working closely with the Serbian government and local officials to ensure the project moves forward responsibly and in a manner that benefits surrounding communities.

Both intended product streams from the project – lithium and borates – play important roles in a more energy-efficient future, the company believes. The first one is a key ingredient in the making of the batteries that power electric vehicles (EVs) and high tech devices. Borates, in turn, are used in insulation fibreglass and wind turbines.

The company has said it plans to start production in 2023, assuming that feasibility studies confirm viability and all necessary approvals are obtained.

Last year, Rio allegedly attempted to buy a $5B stake in Chile’s Chemical and Mining Society (SQM), the world's largest lithium producer. The investment would have provided the world’s No.2 mining company foothold in the booming battery metals sector, though it already holds key copper assets and the red metal is also used in EVs.

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World’s largest hard rock lithium mine to get bigger

Talison Lithium, a partnership between China’s Tianqi and U.S. group Albemarle, secured this week approval from the Western Australian Environmental Protection Authority (EPA) to expand the Greenbushes lithium mine in the southwest of the state.

The decision came with a series of conditions, including the protection of the threatened black cockatoos, which are unique to Australia’s south-west region.

Already the world's largest hard rock lithium operation, the planned expansion would allow Greenbushes increase lithium concentrate output to about 1.95 million tonnes a year, as demand for the key ingredient to build batteries that power electric picks up.

Greenbushes lithium mine, located about 250km south of Perth, produced last year more than 724,000 tonnes of the white metal.

The mine, located about 250km south of Perth, produced last year more than 724,000 tonnes of the white metal.

The A$516-million ($361m) expansion, announced last year, involves the construction of a new lithium concentrate plant capable of producing 520,000 tonnes a year of chemical-grade lithium concentrate. It also entails a new crushing plant and the necessary infrastructure.

If it receives the nod from Western Australia's environment minister, the last one needed, construction will start this year, with the new plant expected to be commissioned in the last quarter of 2020.

Albemarle, which holds a 49% stake in Talison, is planning a lithium hydroxide manufacturing plant, outside of Bunbury, capable of producing up to 100,000 tonnes per year of lithium hydroxide monohydrate from five 20,000 tonnes per year process trains and up to 1.1-million tonnes a year of tailings.

China’s Tianqi, which has a 51% interest in Talison, is constructing a 24 000 t/y lithium hydroxide plant in Kwinana, just 40 km from Perth.

Lithium carbonate prices have been drifting lower from the highs hit in 2017, but remain around the $10,000 to $11,000 level a tonne according to Fastmarkets MB, almost double the $6,450 per tonne at the beginning of 2015.

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Lithium price: Battery capacity of electric cars doubles from last year

Battery capacity of electric cars nearly double from last year

Global car market is at a crossroads. Image courtesy of Velovotee, Creative Commons.

Battery metals tracker Adamas Intelligence says that in March 2019, battery capacity deployed worldwide in battery electric cars (including hybrids) nearly doubled from the same month last year.

The Dutch-Canadian research company, which tracks EV registrations and battery chemistries in more than 80 countries, says 9.76 GWh of passenger EV battery capacity was deployed globally – a 94% year-over-year surge:

This increase in battery capacity deployed is especially remarkable when considering that global EV sales increased by a mere 25% over the same period, speaking to the fact that a far greater number of high-capacity battery EVs (like the Tesla Model 3) were sold this March than the last.

Adamas says based on data from its EV Battery Capacity Monthly study, the sales-weighted average capacity of batteries used in electric cars was 55% higher in March compared to 2018.

All indicators point upwards, except the price

Not only has overall battery capacity grown, lithium's share per kWh has also expanded due to an ongoing shift from lithium iron phosphate (LFP) to nickel-cobalt-manganese (NCM) cathodes among Chinese vehicle makers.

Lithium's share per kWh has also expanded due to an ongoing shift from lithium iron phosphate to nickel-cobalt-manganese cathodes

China's automakers association predicts sales of electric cars in China will reach a record 1.6 million units this year – up from 1.2 million in 2018 – representing around half of global sales. Bloomberg reports there are now 486 EV manufacturers registered in China – more than three times the number two years ago.

Full electric and plug-in hybrid vehicles are also taking market share from traditional hybrid vehicles, meaning that a greater share of kWh deployed this year was in the form of Li-ion cells, as opposed to NiMH cells, which contain no lithium, according to Adamas.

The decline has levelled off, but lithium prices remain under pressure despite the surge in global demand for lithium-ion battery vehicles. The lithium price index compiled by battery supply chain research and advisory firm Benchmark Mineral Intelligence retreated in April and is now down 38% over the past year.

The free-on-board price of lithium carbonate exported from South America's brine lakes now sits at $12,750 a tonne, while spodumene concentrate (6% lithium oxide) from hard-rock lithium mines in Australia is priced at $640 a tonne, down 27% so far in 2019.

Lithium price: Battery capacity of electric cars doubles from last year

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