I recently got into a lithium play at $.05 V.CDO and hoping that the lithium frenzy will propel this allot higher..here is an article from Resource world Magazine.
Lithium scores a spot on Obama's energy independence team
he search for better solutions to the demanding USA energy arena b in full swing. Their quality of life, economical, political, environmental and national security issues require sector-specific and comprehensive solutions. The US. "engines" need diversified and reliable energy supplies while the resolution of the energy quagmire needs policies that must indude conservation, increased effldency. reduced reliance on foreign sources, development of national and secure resources, and advanced technologies, And, last but not least, every solution must be based on sound environmental stewardship, from the source to the end-user, and must Indude consideration of global climate and environmental impacts.
So, what is the latest effort from VS. government to reduce this reliance on foreign sources of energy? Just listen to what President Barack Obama told an audience while speaking in Indiana carry August. announcing US S2.4 billion in grants to advance the manufacturing and use of next-generation car batteries and electric vehicles. He stated, Tm committed to a strategy that ensures America leads In the design and the deployment of the next generation of clean-energy vehicles. This is not just an investment to produce vehicles today; this is an investment in our capacity to develop new technologies tomorrow."
Obama's plan is to have one million electric cars on U.S. roads by 2015. JPMorgan predicts hybrid sales will reach 9.6 million cars three years later. Global Strategic Analysts predicts that the market lor lithium-ion batteries (used in hybrid velucles) is likely to grow at a compound annual growth rate of over 12'"., through 2010
Hooanon Invostment Partners
CANACCORO CAPITAL CORP 2200-609 Granville Street Vancouver, B.C. V7Y1H2 Tel: 604 643-0293 | Fax: 604 643-1851
boom in lithium, lithium exploration, development, and mining? In our opinion, it maybe too early to tell, but the fundamentals are pointing in the right direction. With lithium batteries to play a key role In the auto industry and eventually appearing throughout the electrical grid, lithium could potentially be the next break out investment.
Andrew Mickey of Ql Publishing agrees. He states. 'Total U.S. auto sales may be down 40% this year, but hybrid electric vehicle sales are doing better. As you extrapolate this trend, it's not hard to see bow 10% of the cars sold In the U.S. will have a battery in them in the next few years. Ten % of 10 to 15 million autos made each year is a lot of batteries. Exponentially, more than can be produced
right now. This Is going to be big."
Like any other investor, we cannot help but look at the money pouring into this sector. And. as an investor, one should always consider the flow of money when considering a new sector, a new metal to invest in. or a new investment in general This injection of capital into the system will in many coses create short term upside in stocks having exposure to the sector in question.
Lithium stocks, in fact, have been trading higher this summer with some help from Obama's recent announcement And while many junior companies are raising money on the back of this news and the stocks are trading higher, we caution investors to do their homework before putting any real. long term money into these companies.
Due to lithium's reactivity, it only appears aiturally in the form of compound Lithium occurs in a number of pegmatite minerals, but is also commonly obtained from brines and davv. On a commercial
carbonate (Li,COj, is produced from lithium chloride. Brines and high-grade lithium ores are the present source for all
commercial lithium production.
According to the United States Geological Survey, U.S. reserves of lithium total 760,000 tons. One kilogram of lithium equals S.J kilograms of the lithium carbonate used to make batteries. South America accounted for 60% of world output of lithium in 2008. followed by Australia and China, which combined produced 30% of the total. Two-thirds of the world production was from brines and one-third from lithium minerals (used mainly in the ceramic and glass industry).
The largest players in the sector are Soquimich (SQM). Chemetall (ROC), FMC
Lithium (FMC), Admiralty Resources and Comibol (Bolivian government). Some lithium-focused juniors indude: Canada Lithium (CLQ). Western Lithium Canada (WLC). Lithium One (LI). Rodlnia Minerals (RM). TNR Gold Corp. (TNR). New World Resources (N\V), and First Lithium (MCI), to name a few.
In summary, if you want exposure to President Obama's energy plan, lithium stocks may be a way to do that. Currently. lithium supply and demand are relatively in balance; however, with the race to develop lithium-based batteries for an electric automotive industry there will be a potential shortfall of supply in the future. And again. while the fundamentals support investing in lithium currently, please do company-specific research on each company before investing Stay tuned for more on lithium and companies we think are well poised to take advantage of the potential shortfall of lithium supply in the future. ¦