Cypress Development: "Tight lithium supply means growth opportunities for miners in Nevada’s Clayton Valley"
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"2021.08.21
It’s no secret by now that the world will need more lithium for our clean energy endeavors.
Industry analysts everywhere are forecasting drastic increases in demand for this key EV battery ingredient over the next decade and beyond.
Fitch Solutions is predicting global EV sales to reach over 4.6 million units this year, about 50% more than 2020, even surpassing the previous year’s growth rate of 36.8%.
Recent study by BloombergNEF shows that 5.3 times more lithium will be in demand by 2030 compared to current year levels (see below).
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In its H1 Battery Metals Outlook, BNEF forecasts total battery demand for 2030 has risen 35% over the past year, owing to expected higher sales of passenger electric vehicles.
The surge in demand has also pushed lithium prices to levels last seen in 2018. According to a recent article in The Northern Miner, lithium carbonate and hydroxide prices have climbed by 71% and 91%, respectively, this year.
The performance of lithium prices has also lifted the spirits of lithium miners, as well as their outlook.
After blowing their last year’s H1 earnings out of the water, Chile’s SQM stated in its results call that “global demand for lithium is accelerating at a faster clip than previously thought.”
With electric-vehicle demand surging more than 150% in the first half from a year ago, price growth is exceeding expectations, the world’s second-largest producer told Bloomberg this week, adding that it expects global demand for lithium to increase more than 40% this year.
“We now believe that total global demand could surpass 1 million tonnes in 2025,” the company predicted.
Facing such an enormous rate of demand growth, the industry’s ability to secure more supply should be in question.
In a recent report by Fastmarkets surveying market participants in the battery supply chain, a majority of the respondents flagged lithium as the metal that is the most difficult to secure in the near term.
“The supply of lithium is tight at the moment, as the expansions in South America have taken longer to come on stream,” Will Adams, the head of Fastmarkets’ battery raw materials research team, said.
“And even though this new capacity will shortly be ramped up, it will still take six to eighteen months for the material to be qualified.”
The global lithium market is estimated to reach a deficit of 12,000 tonnes of lithium carbonate in 2022, compared with a surplus of 3,000 tonnes in 2021, according to Fastmarkets’ estimation.
The industry may eventually turn its attention to the US, where President Joe Biden has set an ambitious target to make half of new vehicles sold in 2030 zero-emissions vehicles.
The nation is also scheming to expand its domestic lithium sources, having listed the battery metal as a critical mineral back in 2018, to lessen its reliance on foreign production.
Nevada – Next Lithium District??????????????????????????????????????????
While mainly known for its rich bounty of precious metals, the US state of Nevada — specifically the Clayton Valley region — may be on its way to becoming the next frontier for lithium mining.
It is home to the only lithium-producing operation found in all of North America: Albemarle’s Silver Peak mine, which has been in continuous operation since 1966.
Aside from its favorable geology for lithium brine, Nevada’s access to public land, streamlined permitting and supportive State government are the most important factors that are attracting mining companies.
Cypress Development Corp.
Within the same geographical area, a company that is committed to developing America’s next lithium supply is Cypress Development Corp. (TSXV: CYP) (OTCQB: CYDVF) (Frankfurt: C1Z1), which presently holds 100% interest in a lithium project — also named Clayton Valley — in southwest Nevada.
Cypress’ Clayton Valley property covers a total area of 5,430 acres and is located immediately east of the Albemarle operation (see maps below).
[Blockierte Grafik: https://aheadoftheherd.com/app/uploads/2021/08/image-119.png]Clayton Valley Lithium property location map
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