The Energy Report: The recent announcement that Tesla Motors Inc. (TSLA:NASDAQ) has signed an agreement to purchase lithium from Pure Energy Minerals Ltd. (PE:TSX.V) has created quite a bit of buzz in the mining world. How is this different than previous agreements with Bacanora Minerals Ltd. (BCN:TSX.V) and Rare Earth Minerals Plc (REM:LSE)?
Jeb Handwerger: The most significant difference is that this is in Nevada, where the Tesla gigafactory is being built. The battery and carmaker will need large quantities of lithium at a cheap price, and sourcing it in its backyard will be a smart move for the supply chain.
Years ago, I predicted the growth of the lithium-ion battery market and the need for a secure domestic supply of the critical materials used to make them. This is just the beginning. We’re in the early stages of a revolution in powering transportation and homes. This really is disruptive technology. Annual growth in the battery space could be around 20%, which means that demand could double every five years. These batteries make smartphones, laptops, tablets, electric cars and even solar energy practical.
While the TSX Venture Exchange has been crushed in 2015, our positions in junior lithium mining companies have continued to outperform in dramatic ways. The news out of Tesla to secure supply from Pure Energy Minerals is a huge validation for the concept of lithium in Nevada.
“Annual growth in the battery space could be around 20%, which means that demand could double every five years.”
In July, Pure Energy released an Inferred resource estimate of 816,000 metric tons of lithium carbonate equivalent on the Clayton Valley lithium brine project near Albemarle Corp.’s (ALB:NYSE) Silver Peak producing mine in Nevada. Now that Tesla has validated the project—and the investors that believed …read more