Europe and Australia Making Moves

May 28, 2018

A lot has happened in the lithium space since our last update.  Here are some of the stories that popped out to us:

  • Galaxy Resources, who recently retained JP Morgan to explore their options for the Sal de Vida brine project, just announced a deal with POSCO (the same company that recently signed an agreement with Pilbara) to sell a package of mining tenements in the northern area of the Salar de Hombre Muerto project for $280m.
  • Speaking of Galaxy, they also put out a revised feasibility study.  “Updated results show the site hosts a JORC-compliant reserve estimate of 1.1Mt of lithium carbonate equivalent (LCE) and 4.3Mt of potash (potassium chloride), with potential annual production of 25,000t of LCE and 94,000t of potash.”  A summary of the results can be found here, while the full release can be found on our company newsfeed.
  • Savannah Resources recently reported a 52% increase in the JORC 2012-Compliant Indicated and Inferred Mineral Resource Estimate for Mina do Barroso, which now stands at 14 metric tonnes (Mt) at 1.1% of lithium dioxide (Li₂O).  The company is up ~50% since the announcement and is currently trading at 52-week highs!
  • Orocobre put out a cool 360 degree video shot in 4K of the Salar de Olaroz.  The video can be found here.  Furthermore, the company announced an updated resource estimate of 3Mt LCE for their Cauchari Lithium project.
  • Nemaska Lithium raised another C$400m via an equity raise, completing their total project capex fundraise of C$1.1B.
  • Martin Holland, CEO and Managing Director of Lithium Power International, announced that he is stepping down from his position.  The board has begun the process to find his replacement.
  • SQM released quarterly earnings.  The company expects full year lithium production to reach 55,000t as they ramp up production in the second half of the year.  The company also commented on current favorable market conditions, saying “Demand growth in the lithium market continues to be strong, and we expect it to surpass 20% during 2018, mainly driven by a 54% growth in the battery market for electric vehicles. During the first quarter, supply did not keep the same pace, and therefore market conditions remained tight and prices increased significantly during the first three months of year, totaling an average of approximately US$16,400/MT.”
  • The London Metal Exchange announced that they are looking to offer contracts in metals used in batteries within 18 months.
  • Battery producers Sonnen had their recent $A95m fundraising round led by Shell Ventures, the venture capital arm of the major oil company.  Shell Ventures is also backing an EV charging infrastructure project which will now integrate Sonnen’s smart batteries.
  • The Western Australian government announced that they will form a taskforce to capitalize on the region’s lithium and energy materials potential.  While this arguably could’ve been done earlier, given WA’s ample endowment of strategic energy metals, it’s still a great step for the region and country in the race to establish a dominant position in the fuel market of tomorrow.

Stay tuned via Twitter and email to get our analysis as it hits the tape!