- Standard Lithium owns a lithium extraction technology that could revolutionize lithium mining.
- They are partnered with global chemical company Lanxess to confirm commercial feasibility of their lithium extraction process in the richest source of brine lithium in North America.
- The expected meteoric rise in Electric Vehicle sales will mean an exponential rise in the need for lithium globally and Standard Lithium will be a first mover in the U.S.
- In addition to their access to 150,000 acres of brine lands through their partnership with Lanxess, Standard Lithium has its own land package including 27,000 acres of brine lands in Arkansas and 45,000 acres in California’s Mojave Desert.
- Recent corporate news and stock price movement suggest that investors believe Standard Lithium’s lithium extraction process will be confirmed by Lanxess and the parties will finalize a joint venture and move to the commercialization stage. If they do, it’s off to the races for Standard Lithium.
I’m investing in Canada-based Standard Lithium (OTCQX:STLHF) as a way to play the predicted demand for lithium ion batteries, both EV and stationary. Standard Lithium is traded on the Over-the-Counter market in the U.S. as STLHF and also on the Canadian TSX with the ticker-symbol SLL.
Thus far I have written about a promising graphite miner and a nickel explorer, and now I want to discuss lithium, the third of my essential battery metals basket. Although lithium is only around 11-17% of the cathode in a typical lithium-ion battery, it gets top billing in the name because it is a key player in the battery’s functionality.
My Rationale for Investing in Battery Metals
There is expected to be a massive increase in demand for certain metals including graphite, nickel and lithium, and I’m investing in miners of these metals outside of China for the following reasons:
- The current extraordinary fiscal stimulus from central banks globally, leading to increased metal demand and price increases;
- An industrial electric-vehicle revolution that will require certain commodities at ten times or above the current level within ten years;
- Global geopolitics stressing the importance of strategic reserves of metals used for high-tech industries;
- An administration in the U.S. that has stated its aim to invest in green energy industries, including EVs, batteries, electric infrastructure;
- Political tensions with China specifically that are leading global governments to seek supply sources of key metals outside of China;
- By investing in the miners of materials essential for almost all batteries, one doesn’t need to worry about picking the wrong Electric Vehicle maker to ride the wave of EV adoption.
Lithium-Ion Batteries In Brief
Batteries store energy in chemical form. Lithium, the lightest metal, is very reactive, and likes to shed its single electron. When a lithium-ion battery is being charged, the electron shedding lithium ions stored in the cathode move internally through the electrolyte and a separator in the cell from the cathode to the anode. At the same time, electrons that are prohibited from going through the separator that splits the battery into the cathode and anode regions, gather on the collector plate of the anode via an external conductive wire. When this wire is connected to a load (such as the car’s electric motor), the free electrons gathered at the anode run through the load to unite with the electron-less lithium ions moving back internally to the cathode. Upon recharge, the process begins again, and the lithium-ions move again through the separator to nest in the anode and the electrons gather at the anode collector plate.
The anode of the battery is usually over 95% graphite. The cathode is usually some combination of nickel, cobalt, manganese and lithium.
Lithium-ion batteries can be recharged repeatedly, have a low self-discharge rate, a high energy density, voltage capacity and are relatively light weight compared to other rechargeable batteries. They are now the dominant type of rechargeable battery used in electric vehicles, and look to maintain that position for some time. Scientists have been working on a “solid-state” battery for decades. It is called solid-state because the electrolyte that the lithium ions move through is composed of a solid material like ceramic instead of a liquid or gel.
Whether the solid-state battery hopes are realized soon or in a decade doesn’t affect the status of lithium as a necessary component in batteries. In fact, solid-state battery designs use solid lithium metal as the anode, in addition to the lithium that is part of the cathode.
Predicted lithium demand out to 2035:
Source: Benchmark Minerals via Cypress Development Corp.
As seen in the graph above, the world is essentially at a point right now where supply and demand for lithium is matched. Future supply of lithium is well short of demand, which will, if typical economics hold sway, lead to increased prices. After a period of low lithium prices and lack of investment, land which is promising for lithium mining/extraction is currently seeing huge interest.
Read more of this article here: Standard Lithium: Faster, Cheaper And Greener Lithium Mining To Spark The EV Revolution