June 3, 2016
Jon Hykawy examines the case for the celebrated metal and its overlooked partner
Publisher: Resource Clips
Author: Greg Klein
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- Friday, June 3, 2016Looking at lithium, cobalt too
Under a $2.65-billion deal expected to close in Q4, China Molybdenum gets
majority interest in a DRC mine that's "the world's premier cobalt producer."
Even with his own "conservative" forecasts, Jon Hykawy sees a strong case for lithium. But li-ion batteries call for other commodities too, and cobalt stands out as a critical material facing uncertain supply. Hykawy, president of the consulting firm Stormcrow Capital, sees markets through a number of perspectives. That comes from being a 14-year Bay Street veteran, a physicist who conducted post-doctoral work in nuclear power, and a research scientist who's scrutinized the world of rechargeable batteries and fuel cells, as well as wind and solar energy.
Excerpts from the full article:
The lithium battery was developed in the late '70s, it really became ubiquitous in the '90s, and now you're seeing the fruit of four decades of research. Any replacement would have to go through the same degree of scrutiny. They have to be confident that battery is safe, especially, especially if they plan to sell that device in the United States, the land of the lawyer and the home of the litigious."
Additionally, li-ion has "such a lengthy head start, such advantages in scale and cost, that newcomers couldn't compete in price."
Looking at graphite, he expects rising demand from batteries "but nothing particularly wondrous. It really comes down to a cheap supply, and likely the cheapest supply is going to come out of China. There are juniors trying to bring alternate sources to the market, but they'll have to compete with Chinese pricing."
Then there's cobalt.
"It's a very important part of the battery, it helps increase the amount of energy the battery can contain," Hykawy points out. "The problem is, even with my conservative growth figures for battery use, by 2025 all the cobalt mined in the world today would be required for the battery industry. There wouldn't be anything left for steel."
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