Thursday, 4 May 2017

Tesla Officials Visit Argentina’s Governor Of Salta For Solar And Storage Projects And Sourcing Lithium.




ElectTrek reports that "salt on the salad'": this is how Elon Musk has described lithium before - must be very important for Tesla's digestive system after all. I am writing here extensively about the coming control of the Lithium supply by Chinese companies who are very aggressively buying all the best lithium projects worldwide. It is very difficult to pretend anymore that any lithium will be coming from any signed by Tesla agreements with some junior miners in the nearest future. Lithium cathode is still produced by Panasonic for Tesla Gigafactory. 




Another part of this story is the rising price of lithium in China again. Last year we have seen only 14% rise in lithium supply and prices have increased by 74%. In December, Benchmark Minerals has reported that LCE (Lithium Carbonate Equivalent) was priced below $15k/T and Lithium Hydroxide (the particular lithium based chemical which is used in Tesla batteries) was around $18k/T. Last week I have received reports that in Shanghai LCE was priced at $18k/T and Lithium Hydroxide was at $22k/T. Today there are reports that LCE is already pushing $19k/T. It is all happening just before 4 major Lithium batteries Megafactories will be coming online in China this year and Tesla will move into the mass market stage with the production launch of Tesla Model 3 in July.





As you know, I have been preaching for years that security of lithium supply will be the most important factor determining the competitive advantage among different producers of critical raw materials for the Energy rEVolution. This Lithium Race will have the very far-reaching geopolitical implications. Now it looks like that Tesla is realizing that there is no secure supply of lithium for its massive expansion of operations from the underneath of Gigafactory floor in Nevada. Even if Panasonic is producing cathode for lithium cells which are made at Tesla Gigafactory in Nevada the supply chain is going all over the globe and back to China.





The real test to the market and supply chains for Energy rEVolution will come with the coming tide of Electric Cars and the following tsunami of Energy Storage. Bloomberg has recently reported that there will be more than 120 models of electric cars by 2020 and you should not be surprised as we have discussed here before that there are more than 70 models of electric cars on sale in China already. The next few years will determine who will have the keys to the new Energy rEVolution and control the supply chains. Hungry Dragons are flying high already and mostly in China, the question remains who and how will feed them without fear of being burnt in the process. 






International Lithium And Ganfeng Mariana Lithium JV Exploration Target And Indicated Resource Of 1.25 M T of LCE.






Exploration target at Mariana Lithium, Argentina. 
International Lithium NI 43-101 report.






Kirill Klip, Executive Chairman of ILC stated, "We are very pleased with the results of the maiden resource estimation at the Mariana lithium potash brine project, together with our strategic partner Ganfeng Lithium. This project is now moving from an early exploration stage to an advanced exploration stage where it will be more easily compared to other lithium brine projects in Argentina. We are looking forward to follow up with Ganfeng Lithium on the recommendations of this report in order to ensure the rapid advancement of the project towards the pilot stage and to conduct further feasibility studies that will investigate the economic viability of the Mariana project."



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ElecTrek:


"Tesla has been making more moves into the commercial and utility-scale solar plus energy storage business over the past year. Recent projects like the one on the Island of Kauai and a SolarCity/Tesla Energy project in Connecticut are good examples.

Now we learn that Tesla is looking for similar projects in Argentina as a company executive visited government officials in the country last week. 

Bob Rudd, a former VP of Energy Storage at SolarCity and now Director of Energy Storage and Microgrids at Tesla, met with Governor of Salta Province Juan Manuel Urtubey’s Cabinet Chief, Carlos Parodi, and the Minister of Environment and Sustainable Production, Javier Montero.

In a press release, the Gorvernor said that Rudd expressed Tesla’s “interest in investing in renewable energy” in the region and the province’s potential for lithium exploitation.
They added:
“Rudd said that Salta is the first place in the country that they visit with intentions to invest, due to the advantages offered by the province, both for its natural conditions and for predictability for investors through the official policy of ensuring legal security for development of productive projects.”
Argentina still gets most of its electricity from fossil fuels and therefore, there are a lot of opportunities to develop solar and energy storage projects, but it’s especially interesting that Tesla chose to visit the Salta province, which has been described as “ground zero” for lithium, an important material for Tesla’s batteries.

TESLA’S BOB RUDD MEET WITH THE CABINET OF THE GOVERNOR OF SALTA PROVINCE, JUAN MANUEL URTUBEY
Tesla has previously looked in Chile, where they are large lithium deposits, for partnership with local lithium miners, but it’s the first time we hear of Tesla looking in Argentina to source lithium.

Some of the resources needed to make Tesla’s batteries have come to the forefront of the junior mining industry trying to bring online new mining operations. Especially since Tesla announced that it tripled the planned production of the Model 3 to over 100 GWh per year and now plans to start working on 3 to 4 more Gigafactories.

We recently reported on some companies working on increasing the production of some of the main minerals behind Tesla’s batteries: How to invest in the resource boom that Tesla Gigafactory and electric vehicles are creating.

Several of those companies have claims on lithium deposits in Argentina.
Back in January, Tesla said that it had secured lithium supply through 2017, but the real volume is expected to come in 2018 and Tesla could be looking to secure that supply at this point."