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Cobalt and Lithium Markets Rise in Value as Electric Vehicles Increase in Demand

T.LAC, V.ELBM

FinancialBuzz.com News Commentary

PR Newswire

NEW YORK, June 7, 2018 /PRNewswire/ --

Data published by Zion Market Research shows that the global lithium-ion battery market was valued at USD 31.17 Billion in 2016 and projects that it will grow to USD 67.70 Billion by the end of 2022, while at a CAGR of 13.70% over the forecast period. Lithium ion batteries are highly in demand due to their high energy density and efficient rechargeability. These batteries are used in various applications, with the consumer portable electronic segment controlling the majority of the market capital, followed by electric vehicles (EVs). Technological innovation in the short and long term is expected to push the EV segment forwards. Eventually, electric vehicle manufacturers are set to become the strongest source of demand for lithium-ion batteries. Cameo Resources Corp. (OTC: CRUUF), Lithium Americas Corp (NYSE: LAC), First Cobalt Corp (OTC: FTSSF), Katanga Mining Limited (OTC: KATFF), Nemaska Lithium Inc. (OTC: NMKEF)

The growing usage of lithium ion batteries has caused an increase in demand for the two of its main components, lithium and cobalt. Currently, demand outweighs supply in both markets, which has caused prices to rise significantly. Automakers and tech companies are competing against each other in order to grab the resources available. The competitive market for cobalt has caused prices to triple over the past year to USD 80,000 a ton. "The best lithium battery cathodes [negative electrodes] all contain cobalt, and its production is limited," exaplains study lead Elsa Olivetti, a materials scientist and engineer at the Massachusetts Institute of Technology, who projects cobalt demand could reach 330,000 metric tons by 2025.

Cameo Resources Corp. (OTC: CRUUF) also listed on the TSX Venture Exchange under the ticker (TSX-V: CRU). Today, the company announced breaking news that it, "has entered into a letter of intent (the "LOI") to acquire a large scale land package in Chile's Carrizal Alto's historic cobalt region, located 100 kilometers north of the La Cobaltera District.

Cameo Cobalt's flagship Chilean project is situated adjacent to Genlith Inc.'s ("Genlith") subsidiary, Chilean Cobalt Corp, as per Genlith's April 11 new release (https://www.genlith.com/news/company-update-0).  Genlith Inc. is a Pennsylvania based holding company focused on energy storage and critical battery materials and reports that cobalt production occurred on their Carrizal Alto and La Cobaltera projects from 1844 thru 1944, mostly for military applications ceasing at the end of World War II.

Cameo's CEO, Akash Patel states, "Cameo is excited to option the priority exploration properties adjacent to Glenith's reported historical cobalt production at Carrizal Alto.  We will immediately begin due diligence, and intend to follow up with exploration to define cobalt mineralization on our new mining concessions." 

About the Carrizal Alto Cobalt Project: The area acquired is in Carrizal Alto's historic cobalt producing region and is located 100 kilometers north of the La Cobaltera District.

Project Highlights:

  • 456 hectares in Carrizal Alto district, Chile;
  • Adjacent to historic operating site that has Chilean government production data with high-grade cobalt, as reported by Genlith Inc. (http://www.genlith.com);

The Chilean National Service of Geology and Mining, Sernageomin, performed preliminary work on the La Cobaltera and Carrizal Alto areas in 2008. A November 2017 report by Chile's Corporation for the Promotion of Production ("CORFO") states that the San Juan District has cobalt mineralization in veins and mantos (hydrothermal bedded deposits). The report identifies the land package Cameo Cobalt has secured as within one of the main areas of cobalt mineral potential in Chile. 

In the San Juan-Carrizal district, primary cobalt mineralization occurs as cobaltite, a cobalt sulfo-arsenide. At surface, cobalt occurs as a secondary oxidized mineral, erythrite, a cobalt arsenate. Mineralization occurs mainly in veins and mantos with average cobalt concentrations of 1.6% for primary ore, and up to 6.4% for secondary oxidized ore.

Most recently the Geological and Mining Service of Chile carried out regional sampling of mineralization and hydrothermal alteration systems in the metallogenic province of the Coastal Cordillera of the Atacama and Coquimbo regions. Geochemical data was processed and analyzed by Artificial Neural Nets (ANN).  No significant modern exploration or drilling has taken place in the region since then, which has historically been well endowed with copper and cobalt…"

Lithium Americas Corp (NYSE: LAC), together with SQM, is developing the Cauchari-Olaroz lithium project, located in Jujuy, Argentina, through its 50% interest in Minera Exar. s pleased to provide an updated mineral resource estimate (the "Resource Estimate") on the Thacker Pass deposit (previously Zone 1) ("Thacker Pass") of the Lithium Nevada Project (the "Lithium Nevada Project" or the "Project") located in the McDermitt Caldera, Nevada, USA. . At a cut-off of 2,000 parts per million lithium ("ppm Li"), the updated Resource Estimate consists of a Measured and Indicated Resource of 385 million tonnes grading 2,917 ppm Li for 6.0 million tonnes of lithium carbonate equivalent ("LCE") and an Inferred Resource of 147 million tonnes grading 2,932 ppm Li for 2.3 million tonnes of LCE. The updated Resource Estimate will be incorporated into a Preliminary Feasibility Study (the "PFS") on the Lithium Nevada Project with results on track to be released by the end of Q2 2018. "Exploration work in 2017 has successfully expanded the lithium resource at the Lithium Nevada Project. More specifically, the results reveal additional high-grade and near surface lithium mineralization northwest of the original pit area that was proposed in 2012," commented Alexi Zawadzki, Lithium Americas' President of North American Operations.

First Cobalt Corp (OTC: FTSSF) is a vertically integrated North America pure-play cobalt company. First Cobalt announced on June 4th, 2018 the completion of the previously announced acquisition of US Cobalt Inc. by way of plan of arrangement. US Cobalt shareholders will receive 1.5 common shares of First Cobalt for each US Cobalt share held and US Cobalt has become a wholly-owned subsidiary of First Cobalt. The transaction received formal approval from the Committee on Foreign Investment in the United States (CFIUS) on June 1, 2018. Trading of US Cobalt shares is expected to be halted until they are delisted from the TSX Venture Exchange at close of June 5, 2018. Trent Mell, President & Chief Executive Officer, commented: "Garett Macdonald's extensive experience as a mine developer is a welcome addition to the board of First Cobalt as we move to fast track activities at the Iron Creek Project in Idaho and leverage synergies with First Cobalt's refinery in Ontario. I am pleased to welcome him to the board and I look forward to his input on strategy and execution."

Katanga Mining Limited (OTC: KATFF) operates a major mine complex in the Democratic Republic of Congo producing refined copper and cobalt. Katanga Mining is pleased to announce its ore reserve and mineral resource estimates as at December 31, 2017. Overall, the measured and indicated mineral resource for Kamoto Copper Company SA ("KCC") (in which the Company has a 75% interest) increased by 7.7 million tonnes since December 31, 2016, consisting of the following: There are no changes in the measured, indicated or inferred mineral resources reported for Mashamba East, KTO Underground, T-17 Open Pit / T-17 Underground Mine, Kananga Mine and Tilwezembe Open Pit Mine, as no mining and no geological work was undertaken in these areas in 2017.

Nemaska Lithium Inc. (OTCQX: NMKEF) is a developing chemical company whose activities will be vertically integrated, from spodumene mining to the commercialization of high-purity lithium hydroxide and lithium carbonate. Recently, the company announced the signature of an agreement in principle providing for the supply by the Corporation to Northvolt of battery grade lithium hydroxide. Under this agreement in principle, Nemaska Lithium agreed to supply, through its wholly-owned subsidiary Nemaska Lithium Shawinigan Transformation Inc., and Northvolt agreed to purchase, on a take-or-pay basis, up to 5,000 but not less than 3,500 metric tonnes per year of lithium hydroxide produced at the Corporation's commercial plant in Shawinigan, for a 5-year supply period commencing upon the start of commercial production at both the Shawinigan Plant and Northvolt's projected Skellefteå factory in Sweden. In connection with this supply of lithium hydroxide, Northvolt has agreed to deliver to the Corporation a EUR 10M promissory note which, at the Corporation's option, can be converted into voting shares of Northvolt in connection with the N Factory funding, or redeemed at cost plus an agreed-upon interest rate.

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