ALB - VIDEO Round-Up: Battery Metals at PDAC 2019
The 2019 Prospectors & Developers Association of Canada (PDAC) convention was a hot bed of excitement especially around the battery metals sector, with industry experts and CEOs weighing in on the future of the market.
The conference was held at the Metro Toronto Convention Centre from March 3 to 6, and saw 1,000 exhibitors, 3,500 investors and 25,000 attendees from 135 countries come together to celebrate all things mining and attend a wide variety of presentations, panels and discussions.
If you were unable to attend the four-day mega mining event have no fear, we’ve got you covered. The Investing News Network took to the PDAC floor to speak with battery metals experts, analysts and company CEOs to find out what investors need to know about the upcoming EV revolution and which battery metals will reign supreme. Scroll down to view all of our coverage from the conference.
Simon Moores: Big Investors are Turning Down the Century’s Top Trend
Simon Moores, managing director of Benchmark Mineral Intelligence, spoke to INN about the growth of lithium-ion megafactories and the unique demand the electric vehicle proliferation is having on the battery metals sector.
“[Raw materials are going] from niche to mainstream,” he said. “No one has done [this] before; no one has produced lithium, cobalt, graphite anode or nickel chemicals [at the scale that’s going to be needed].”
Chris Berry: Is Lithium Still a Good Investment?
When it comes to lithium, Chris Berry, founder of House Mountain Partners, believes China will always be a major factor in the battery metals equation.
“I don’t think investor focus will ever shift from China because it is just such a big portion of the market,” he said. “With respect to pricing, what I think you will see in 2019 and beyond — outside of China on the contract basis, prices are broadly flat, maybe they swing 5 or 7 percent up or down either way, but you are not going to see a huge swing up or a huge swing down.”
Berry also shared his thoughts on junior miners in the sector and how investors should approach the lithium market.
Howard Klein: Lithium is a One-way Bet with a Long-term Time Horizon
Howard Klein, founder of RK Equity, also weighed in on the current lithium market, noting 2019 has been a challenging year for some producers.
Despite the current challenges steady demand in the sector will likely be a price catalyst.
“Demand is higher than supply and that translates into higher prices, in my opinion, sometime soon,” said Klein.
He also offered his take on major players in the sector, such as Albemarle (NYSE:ALB), Livent (NYSE:LTHM) and SQM (NYSE:SQM).
Guy Bourassa, Nemaska Lithium: Financing Challenges, Demand Outlook and What’s Next
Quebec-focused Nemaska Lithium (TSX:NMX,OTCQX:NMKEF) also attended PDAC. We sat down with President and CEO Guy Bourassa, who talked about Nemaska’s Whabouchi project, its financial shortfall and what’s ahead for the company.
“People have to understand that in the last 18 months we have been working, trying to finance this project with potential partners, potential offtakers, real offtakers, banks and the bonds,” explained Bourassa.
According to the CEO and president, the company believed it was well positioned and funded.
“We [underwent] 10, 12, maybe 15 due diligence, coming with five due diligence reports by outside international firms — nobody raised any questions about the budget,” he said. So given the market at the time, given the information we had … we would not have done it differently.”
Mines and Energy Minister: Lithium Potential Bright for Resource-rich Peru
At this year’s Prospectors & Developers Association of Canada (PDAC) convention, the Investing News Network had the chance to talk to Peru’s mines and energy minister, Francisco Ismodes.
Ismodes shared his thoughts on mining in Peru, what challenges are ahead for the South American country and what the future holds for lithium projects there.
Chilean Mines Minister: Electromobility and Chile’s Mining Future
Chile’s mines minister, Baldo Prokurica, shared his thoughts on mining in Chile, what challenges are ahead for the country and what the future holds for lithium, cobalt and copper projects there.
Anthony Milewski, Cobalt 27 Capital: Battery Metals Demand Will Be Tremendous
Offering insight into cobalt’s impact on the battery metals space was Anthony Milewski, CEO of Cobalt 27 Capital (TSXV:KBLT). Milewski sees the price of cobalt steadily increasing in 2019.
“We are currently in the US$15 mark; I anticipate that for the balance of the year we will see cobalt prices [reach US$25],” said Milewski.
The Cobalt 27 Capital CEO also explained how battery metal demand will affect the nickel, cobalt and manganese markets.
“The new demand for nickel, which will be tremendous, will come from batteries,” he said.
Byron King: Rare Earths are the Real Secret to EVs
Lithium, nickel and cobalt weren’t the only metals top of mind by industry experts when discussing electric vehicles. Rare earths play an equally important role in the emerging global market for electric vehicles. Byron King editor of Rickard’s Gold Speculator at Agora Financial thinks rare earths are “the real secret to EVs.”
“First of all there are rare earths in the batteries, and second of all, the traction motors the motors that that turn the wheels that actually make the rubber meet the road and give you the traction that rolls you down the highway,” explained King. “Those traction motors run on strong rare earth magnets. You’re talking about moving from a few ounces of rare earths in a car to several pounds of rare earths in a car once you go electric.”
Luisa Moreno: “Rare Earths Demand Will Continue to Go Up”
Rare earths were also the topic of discussion when INN sat down with Luisa Moreno, managing director of Tahuti Global. Moreno sees demand for the high strength magnet metals increasing, but warns that supply chain needs to be developed outside of China.
“I think the demand will continue to go up, everyone talks about electric vehicles and there is potential for more companies to adopt the permanent magnet motors, those do use neodymium; but you know there is increasing demand for technologies and for mobile technologies and so forth so there will be use in applications for the various rare earths,” she said.
As China remains the top producer of rare earths the currently control supply and demand.
“For the West to be able to catch up with China in terms of developing a supply chain it will be important to have more production outside of [that country],” Moreno added.
Don Bubar, Avalon Advanced Materials: It’s Time to Develop a REE Supply Chain Outside of China
INN also had a chance to chat with Don Bubar, CEO of Avalon Advanced Materials (TSX:AVL,OTCQB:AVLNF) and this year’s winner of the 2019 PDAC Distinguished Service award, celebrating his commitment and longstanding service to the PDAC and its efforts to foster a welcoming space for Indigenous people.
Bubar echoed Moreno’s sentiment of the need for a rare earth supply chain independent of China and believes his company’s Nechalacho rare earth project may be the answer.
“We almost got that project off the ground and took it all the way through feasibility and then of course the bubble burst in the 2012 timeframe so we’ve been sort of waiting for another opportunity for that demand to come back, and we knew it would happen sometime because that supply chain on rare earths never did get created in any real meaningful way outside of China,” said Bubar.
Boom or Bubble: EVs Are Here to Stay
The EV story was a talking point on each day at the Prospectors and Developers Association of Canada convention, where the Investing News Network took the opportunity to sit down with John Pfahl of SRK Consulting to talk about all things electric and how the EV market was tracking.
United States in the Passenger Seat of EV Story
At PDAC the Investing News Network asked industry insiders where the US stands in the battery metals and EV story — and it isn’t in the lead.
Simon Moores: Energy Storage Revolution is Coming, but Expect Delays
Speaking at this year’s Miller Thomson PDAC “Lithium-ion Battery Materials and Supply Chains” seminar, Benchmark Mineral Intelligence Managing Director Simon Moores said that even though the energy storage revolution is coming, it will be delayed.
For all of INN’s PDAC coverage, check out our PDAC 2019 playlist.
Don’t forget to follow us @INN_Resource for real-time news updates!
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Nemaska Lithium is a client of the Investing News Network. This article is not paid-for content.
The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.