Li-Ion Battery Sector Could Power Up A Portfolio
Jeb Handwerger | Mar 20, 2016 05:12AM ET
Usually after PDAC the large mining convention in Toronto ends, there tends to be a hang over from all the partying and promoting. Stocks have tended to pullback and volume dwindled. However, I am keeping a close eye on the lithium sector which continues to be quite exciting and generating a lot of investment interest as the lithium price continues to soar.
This week there was some exciting activity for some of our holdings. Starting off this week, Western Lithium USA Corporation (TO:WLC) was featured in a Reuters Article entitled ”Battery-hungry world turns to South America’s ‘lithium triangle’.”
It seems as the mining business in Argentina is turning positive.
“For 10 or 12 years, (Argentina) was a do-not-invest zone. The tone of doing business has just swung 180 degrees,” said Tom Hodgson, the chief executive of Western Lithium, which is developing a project in the country due to begin production next year. Argentina now has a “major opportunity” to build a lithium export business, Hodgson told Reuters earlier this month at a mining conference in Toronto. Western Lithium is working with Korean steelmaker POSCO (NYSE:PKX), whose chairman was in Argentina last month to meet with Macri and begin the construction of a new lithium plant, due to begin commercial production within a year…”
Look at the last page on the company presentation and it does not take a rocket scientist to realize exciting things could be taking place with Western Lithium’s Cauchari Asset in Argentina. Stay Tuned.
Another company that broke out this week into new highs on great volume which could be critical for the battery sector is Graphite One Resources (TO:GPH), which announced news “GRAPHITE ONE PRODUCES MINIMUM 99.98+%CG U.S.-SOURCED STAX GRAPHITE CONCENTRATE”. This graphite may be unique and could be the supply the battery makers require.
“From the time we identified the unique mineralization of our STAX graphite, we’ve observed a number of potential performance advantages,” said Anthony Huston, CEO of Graphite One. “Now, with the first three phases of our product development program complete, we have been able to validate the assumptions we made in terms of the purity we could achieve. We look forward to the results of the remaining phases.”
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I am quite excited for both Graphite One and Pure Energy’s PEA this year which could make both these companies out performers in this exciting lithium-ion battery sector.
Pure Energy's (TO:PE) PEA from its Clayton Valley Resource is also due in the middle of 2016. The chart looks excellent forming a classic cup and handle and could be once again on the verge of its next breakout similar to last summer. They came out with news this week entitled “Pure Energy Minerals Begins Building Engineering Team for Upcoming Preliminary Economic Assessment”.
“The engineering team will be working immediately on developing and optimizing the process options for the brine resources from the CVS Project, and will be integrating their findings with the mini-pilot process testing work that will commence in the coming weeks with Tenova Bateman at their pilot plant in Israel. The successful outcome of this work will be an integral component of the PEA targeted for release in the middle of 2016.”
Patrick Highsmith, Pure Energy Minerals CEO, commented: “Joining forces with Arithmetek and Andeburg provides Pure Energy with unique access to a cadré of seasoned process engineering professionals who can have immediate impact and help us efficiently advance the CVS Project towards a PEA. I worked closely with Ernie during my tenure at Lithium One. He helped us focus and optimize the engineering studies; ultimately leading to savings on early-stage engineering and improved estimates of capital and operating costs.”
Finally, watch Nano One Materials (NNO.V) forming a bullish cup and handle chart with increasing volume. The company just got a $2 million grant to advance their nano technology on using special cathode materials for lithium ion batteries. This is no make believe company as it has a great management team behind it with Mr. Matysek and Dr. Campbell. Dr. Campbell was the principal scientist for Automotive Fuel Cell Cooperation Corp and Ballard Power Systems. He has over 19 patents to his name and specializes with fuel cells and batteries for the automotive sector. He led a large research group focused on polymer electrolyte lithium battery materials.
Mr. Matysek was CEO of Lithium One which merged with Galaxy Resources (AX:GXY) for $112 M. Before that he was CEO of Potash One which was taken over for $434 million. Prior to that he was CEO of Energy Metals which was bought out for $1.8 billion. This is a track record of a winner.
The stock has had so much good news this month and should be higher if it was not for some overhead resistance. Once that is worked through and as more investors become aware of this unique battery technology story run by the best in the business it could move much higher.
Look at the recent news this month. It should start getting recognized by investors so don’t be surprised of a re-rating.
Disclosure: I own all these companies and have bought shares either through private placement and/or in the open market. They are all website sponsors so be aware I do have a conflict of interest and could benefit if share prices increase. Do your own due diligence and always consult with a registered financial advisor which I am not. This is purely for entertainment purposes.
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