Lithium and cobalt projects are beginning to look more and more like gold mines, as Canada and the US agree to collaborate on critical minerals

Posted by on June 21, 2019 6:35 pm
Categories: Cobalt Lithium NEN Exclusives

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On Thursday, June 20, 2019, United States President Donald Trump met at the White House with Canadian Prime Minister Justin Trudeau to discuss many issues, ranging from the United States Mexico Canada trade agreement, better known as the USMCA, to Iran, and everything in between.

During a brief press session prior to meeting, which lasted just under thirteen minutes, the reporters in attendance focused heavily on the USMCA in broad terms, as well as on Iran, and to a lesser extent sports, whereas very little attention was paid to a few comments made by Trump, which I believe my readers here at New Energy Narrative may find very interesting.

At the 9:47 mark in the video above, Trump states “We talked about electric cars,” in reference to a conversation he had with his long-time friend and auto-racing legend Roger Penske, who was presented the Presidential Medal of Freedom that same day, following his Team Penske’s victory in 18 Indianapolis 500 races and two Daytona 500s races. Trump would go on to add, “I think nobody knows more about that subject…than Roger Penske.”

Judging from the above comments, and taking into account the following set of tweets by Trump from January and May of 2019, in which he showed strong support for both Volkswagen’s plans to build an electric vehicle plant in Chattanooga, Tennessee and GM’s plans to sells its shuttered auto plant in Lordstown, Ohio to electric vehicle maker Workhorse Group, it appears the President, who up until recently was a harsh critic of electric vehicles, is beginning to warm up to EVs in a very big way.

Now, whether this shift in Trump’s attitude is because he’s begun to realize that electric vehicles make sense economically, especially whereas they’re expected to be cost-competitive with internal combustion engine vehicles by 2022 and reach cost parity with them by 2024, whether he’s begun to understand how their success dovetails with his Administration’s national-security-related push for U.S. critical minerals independence, or both, the fact is, for battery metals investors like me and my readers, this is great news.

Sweetening the situation even further, the White House and Canada, in a joint statement, have revealed that Trump and Trudeau have issued orders to their respective officials to pursue collaboration between the two countries on “critical minerals,” which, for those who don’t know, are a group of metals, which, according to a list released by the U.S. Department of the Interior on May 18, 2018, includes lithium, cobalt, graphite, aluminum, and manganese, all of which are required in the production of lithium-ion batteries for electric vehicles.

This announcement follows reports that the United States has chosen to partner not only with Canada, but Australia (and to a lesser extent potentially, Mexico) as well, as it seeks to reshape the global landscape, specifically with regards to the supply chains for the metals the country depends upon for national security purposes, which, in addition to the metals listed above, include others such as rare earth elements (REEs), bismuth, scandium, and vanadium.

The exciting in the battery metals investment community, following the above developments, has been palpable.

According to Noah Seidman on Twitter, a self-proclaimed “Android specialist” and “crypto perma-bull,” who also happens to be an avid investor in junior lithium mining companies, he imagined that when asked by President Trump “what projects are most important,” in terms of which critical minerals projects Canada has in its pipeline, Trudeau likely responded with something along the lines of, “Well, we have the only meaningful lithium refiner being built outside of China”—a clear reference to Nemaska Lithiums lithium chemical plant currently being constructed in Shawinigan, Quebec, Canada, which is slated to produce 33,000 tons per year of lithium carbonate equivalent (LCE) over the course of the 33-year mine life of Nemaska’s world-class Whabouchi lithium mine.

While the above is simply an assumption, or perhaps some wishful thinking, on the part of Seidman, it is, however, and in my honest opinion, not without merit, as there are several development-stage or “shovel-ready” mining projects located in Canada that could massively assist the United States in meeting their critical minerals and national-security-related goals.

The first such project that comes to mind for this writer is the aforementioned Whabouchi/Shawinigan lithium project run by Nemaska Lithium, which is easily the most important critical minerals project in all of Canada at the moment. Once finished, it will represent the only major, “vertically-integrated” lithium project outside of China, with the ability to convert hard rock lithium feedstock, in the form of spodumene, into the high-margin lithium chemical known as lithium hydroxide, which is needed for the high-nickel-content, low-cobalt batteries that electric vehicles battery producers around the world are currently working on.

Other projects deserving of mention are Sayona Mining’s Authier and Tansim lithium projects (also located in Quebec, within just a few kilometers of each other), Fortune Minerals’ NICO cobalt-gold-bismuth-copper project (located in the Northwest Territories, with a refinery potentially to be located in Saskatchewan), First Cobalt’s cobalt refinery (which is currently under refurbishment in Ontario and expected to initially process cobalt from the Democratic Republic of Congo, before transitioning, eventually, to using feedstock from the company’s Iron Creek cobalt and copper project in Idaho), GeoMega Resources’ rare earths magnet recycling project, and American Manganese’s lithium-ion battery recycling project (which makes use of its patented RecycLiCo™ technology).

All of the above projects are either already under construction, being worked on inside of pilot plants, or in the midst of financing negotiations, and every single one of them could play a major role in helping the United States and its allies (including Canada and Australia) wean themselves off of the Chinese teat, in terms of a critical minerals dependency which is, as Republican Senator Lisa Murkowski so eloquently put it earlier this year, America’s “Achilles’ heel.” And I, for one hope they all succeed, and sooner rather than later, not only for the sake of investors like me, for but the sake of peace and security all around the world, which depend upon a strong Western civilization that cannot be held hostage by a communist country like China, which is hell-bent on becoming a hegemon in the very near future.

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Disclosure: I am currently long on the stocks of Nemaska Lithium (OTC:NMKEF), Sayona Mining (OTC:DMNXF), Fortune Minerals (OTC:FTMDF), and American Manganese (OTC:AMYZF), and am seriously considering taking a position in First Cobalt (OTC:FTSSF) and GeoMega Resources (OTC:GOMRF) in the near future, as well as a number of other critical minerals/battery metals companies I believe may play a very important role in the electric vehicle supply chain over the next few decades.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from/through New Energy Narrative, which I am the founder and owner of).

Please note: This article covers one or more stocks trading at less than US $1 per share and/or with less than a US $100 million market cap. Please be aware of the risks associated with these stocks.

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