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Albemarle (NYSE:ALB) Inks Huge Deal for Chinese Lithium Company and Critical Plant

The world’s top lithium producer is about to get even bigger, as Albemarle (NYSE:ALB) is buying Chinese company Guangxi Tianyuan New Energy Materials….

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This article was originally published by Mining Feed
Electric car lithium battery pack and power connections.

The world’s top lithium producer is about to get even bigger, as Albemarle (NYSE:ALB) is buying Chinese company Guangxi Tianyuan New Energy Materials. The $200 million dollar deal will further cement Albemarle’s position as the number one lithium producer in the world and increase production.

Albemarle is getting an important asset at a very critical time. Lithium is becoming more important than ever with the rise of battery technology at the forefront of the economy. Founded in 2017, Guangxi Tianyuan New Energy Materials has a recently constructed lithium processing plant in Guangxi. The plant is close to the port of Qinzhou, making it strategically accessible for the company to export its product. 

The project is not operational yet, but it is in the commissioning stage. Albemarle said it hopes to bring the project online for commercial production in the first half of next year. The plant has a capacity o f25,000 tonnes of lithium carbonate equivalent (LCE) and can produce the battery-grade lithium carbonate and lithium hydroxide that is so valuable in today’s modern economy. 

Plants like these will form a strategic part of Albemarle’s strategy going forward as it strengthens its position in this particular corner of the market.

At the same time, the company is increasing the production of the critical material for which prices are rising rapidly. Earlier in September, lithium prices skyrocketed to their highest level in the pat three years. Optimism about EVs and record electric vehicle sales around the world have depleted lithium stocks in China, which is the top consumer of the material.

According to a report by Benchmark Mineral Intelligence (BMI) demand for lithium could jump 26.1% in just five years from approximately 100,000 tonnes of LCE to 450,000 LCE, creating a production deficit of 10,000 tonnes in the process. That is a very short timeline for this shift, and companies are scrambling to keep up. 

Albemarle, as the leader in production, produced lithium from salt brine deposits in Chile and the United States and has hard rock joint venture mines in Australia. A deal like this one will surely further cement the company’s position as a critical lithium producer. 

A Second Challenge to Face

The lithium market will also need to adapt to new environmental standards, as recycling for materials and batteries generally becomes more widely adopted.

As electric vehicles become more widespread, the market for battery recycling will grow. Most components of lithium-ion batteries can be recycled but the cost of material recovery remains a problem for the industry. The US Department of Energy supports the Lithium-Ion Battery Recycling Award to find solutions for the collection, separation, storing, transportation, dispensing, and discarding of lithium-ion batteries for subsequent recycling.

American battery technology companies in Nevada that mine and process lithium use it in their own production processes and sell the other materials. Brunp Reycling, a subsidiary of CATL, the world’s largest manufacturer of electric batteries, operates a dozen hydrometallurgical recycling plants in China. The company says it recycles 120,000 tonnes of old batteries a year, which is half of China’s current annual battery recycling capacity.

Lithium stocks are riding a wave of demand for the metal, drowning in a deluge of new offerings coming onto the market. Worldwide battery capacity is currently around 455 GWh with the average lithium-ion battery system at 79 GWh.3 Battery manufacturers are planning massive capacity expansions in the next decade, with an estimated production of 2,450 GWh by 2029 enough to supply 49 million electric vehicles annually.4 Looking ahead, 49 million cars will account for 65% of global automotive sales in 2019.

How Does it Work?

Lithium is the main active material in rechargeable batteries for electric cars. It occurs in rocks and clay deposits as a solid mineral that dissolves into brine.

Tesla drew attention to the raw materials needed to produce batteries for electric vehicles by signing a sales contract with Piedmont Lithium to secure a third startup production for 10 years even though its mines are not yet in operation. 

The key type of new battery technology will be solid-state lithium batteries, which companies like Albemarle produce lithium for. Solid-state lithium batteries use a solid material instead of combustible gels.

Natalie Scott Gray, the senior metals analyst at the StoneX Financial Services firm, said the market for rechargeable batteries had increased fivefold in the past 20 years. The lithium market is still relatively small, said Andrew Miller, product director at Benchmark Mineral Intelligence, a price-awareness agency that specializes in the lithium-ion battery market.

Before the Turn of the Millenium    

The revolution in lithium-ion batteries began in the early 1990s when Sony and several other companies started commercial versions of lithium-ion batteries. Lithium-ion batteries are now the standard choice for most household electronic devices and appliances and electric cars because of their higher energy density than other technologies. Industry analysts expect the price of electric vehicles (EVs) to be equal to combustion engine vehicles by 2025, with convergent costs for batteries to fall even further.

With millions of electric vehicles already driving on roads and an increasing number of countries around the world focused on the growing volume of electric vehicle sales, we can expect strong growth in demand for lithium-ion batteries. Since lithium-ion batteries are the dominant choice for many applications, especially electric vehicles, the question of the global supply of lithium is timely. 

The increasing use of lithium batteries for energy storage reveals one of the dirtiest sides of the transition to a low-carbon economy. The production of batteries requires a range of rare-earth metals, which require heavy mining and production and emit significant emissions. Important components such as lithium, nickel, and cobalt exist in finite quantities and are unlikely to meet current and future demand for battery units.

Lithium-ion batteries are used in most portable consumer electronics as well, such as mobile phones and laptops because they contain high energy per mass unit compared to other electrical energy storage devices. 

 

The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a licensed professional for investment advice. The author is not an insider or shareholder of any of the companies mentioned above.

The post Albemarle (NYSE:ALB) Inks Huge Deal for Chinese Lithium Company and Critical Plant appeared first on MiningFeeds.






Author: Matthew Evanoff

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Energy & Critical Metals

A $57 Price Target Could Be Just the Beginning for Xpeng

Let’s be honest. Not every investor loves Chinese companies and stocks right now. Perhaps some investors saw what happened to ride-hailing giant Didi…

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Let’s be honest. Not every investor loves Chinese companies and stocks right now. Perhaps some investors saw what happened to ride-hailing giant Didi Global (NYSE:DIDI). As a result, maybe they’re afraid to take a position in China-based electric vehicle (EV) maker Xpeng (NYSE:XPEV) because XPEV stock might also tank.

Source: Johnnie Rik / Shutterstock.com

Yet let’s not make generalizations. Granted, the Chinese government has been cracking down on some companies, mainly due to cybersecurity and antitrust concerns.

But not every China-based company is in trouble. Moreover, XPEV stock won’t necessarily meet the same fate as Didi and other Chinese stocks.

Indeed, recently issued statistics indicate that Xpeng is firing on all cylinders. Besides, one prominent analyst is bracing for its shares to climb, and his bullish argument is convincing.

A Closer Look at XPEV Stock

The shares did have their time in the sun, back in November 2020. At that time, the share price rocketed from $20 to a peak of $74.49.

Unfortunately, folks who chased the stock in the mid-$70’s were soon punished for their haste. As it turned out, a nasty crash ensued in late 2020 and persisted throughout the first few months of 2021.

Since the summer, XPEV stock has been rangebound and can’t seem to break above $45. There’s an old saying, though: the longer the base, the higher in space. In other words, prolonged sideways periods can sometimes be the launch pad for a major breakout.

So don’t be discouraged by the lateral movement of XPEV stock. A big move could be just around the corner – and it would be a shame if you don’t have a position in the stock when it happens.

No One Can Argue With These Results

Stocks will always have their doubters and naysayers, especially when it comes to Chinese companies nowadays. However, the skeptics would be hard-pressed to argue with the numbers included in Xpeng’s recently published vehicle delivery update.

Seriously, the company just killed it across the board. For one thing, Xpeng posted 10,412 deliveries in September, marking the company’s highest-ever monthly delivery figure.

Along with passing the 10,000 milestone, that number also represents a 199% year-over-year surge and a 44% increase over the previous month.

Do you need more ammo that supports the bull thesis? Here you go: for Q3, Xpeng achieved a quarterly record of 25,666 deliveries. That amounted to a 48% increase versus Q2, as well as a 199% YOY improvement.

But wait; it gets even better when we extend the timeline. In the first nine months of the year, Xpeng delivered a total of 56,404 vehicles, which represents a whopping YOY increase of 300%.

Bear in mind, this occurred during a semiconductor shortage, as well as the Chinese government’s crackdown on multiple industries.

Yu Said It

Even with those delivery stats in mind, some folks will still be nervous about Xpeng because Chinese stocks have taken a beating this year. To help assuage their fears, I’ll refer the skeptics to Deutsche Bank’s Edison Yu.

While acknowledging that there have been several reasons for the underperformance of Chinese stocks, Yu asserts that the “largest overhang” has been investors’ reluctance to commit to the nation’s equities following the Chinese authorities’ crackdown on Didi.

I tend to concur with Yu’s reasoning. Looking ahead, Yu believes that “sentiment {towards Chinese EV stocks)  could be bottoming going into year-end.” That, of course, should be beneficial to Xpeng and its shareholders.

Furthermore, for Q4, Yu believes that Xpeng’s delivery guidance in the 35,000 to 40,000 range, and he predicts that the company will deliver 15,000 vehicles in December.

Those estimates are realistic, and would bring Xpeng’s full-year volume to almost 94,000 deliveries, representing a 247% YOY increase. Yu raised his price target on XPEV stock from $51 to an even more ambitious $57.

The Bottom Line

I like the sound of $57, but long-term investors can aim even higher than that if they truly believe in the company. And why wouldn’t they? Just look at those delivery numbers and the surges in the automaker’s deliveries.

They’re outstanding and suggest that XPEV stock deserves to be much higher.

So if you own the stock, just be patient and be prepared for a spectacular ending to Xpeng’s  record-breaking year.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

The post A $57 Price Target Could Be Just the Beginning for Xpeng appeared first on InvestorPlace.

Author: David Moadel

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Energy & Critical Metals

Neo Lithium Sitting on US$1.13B After-Tax NPV of “White Gold” in Argentina

Neo Lithium Corp. (TSXV: NLC) shared on Tuesday the results of its feasibility study for the production of lithium carbonate…

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Neo Lithium Corp. (TSXV: NLC) shared on Tuesday the results of its feasibility study for the production of lithium carbonate at its Tres Quebradas lithium brine project in Catamarca Province, Argentina. The results highlighted US$1.13 billion after-tax NPV8%.

 

Compared to the previous pre-feasibility study, the results of the feasibility study show mine life extends to 50 years from 35 years. After-tax IRR is expected to be at 39.5% and the payback period is expected to be after 2.25 years from the start of the production.

The property is estimated to have an annual average production of 20,000 lithium carbonate tonnes. Furthermore, the property is expected to incur cash operating costs of US$2,954 per lithium carbonate tonne.

On capital costs, the property’s initial spending came to US$370.5 million, and sustaining capital spending is expected to be US$143.5 million for the life of mine.

The study also reported measured & indicated resources of 1.75 million tonnes of lithium carbonate at 800 mg/L cut-off and 5.37 million tonnes of lithium carbonate at 400 mg/L cut-off.

Proven and probable reserves for the property are reported to be 0.77 million tonnes of lithium carbonate equivalent for the first 20 years of production and 1.67 million tonnes of lithium carbonate equivalent for the life of mine.

Earlier this month, the mining firm announced that it will be acquired by Chinese mining company Zijin Mining Group Co. in a $960 million all-cash deal.

Neo Lithium last traded at $6.26 on the TSX Venture.


Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

The post Neo Lithium Reports US$1.13 Billion After-Tax NPV For Tres Quebradas appeared first on the deep dive.

Author: ER Velasco

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ABB, MEDATech demo fully automated fast charging solution on Western Star 4900XD-e

A new prototype ultra-fast charging platform for heavy-duty applications that features the ABB Ability™ eMine FastCharge charger and MEDATech ALTDRIVE…

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A new prototype ultra-fast charging platform for heavy-duty applications that features the ABB Ability eMine FastCharge charger and MEDATech ALTDRIVE battery-electric powertrain solution is helping automate the charge of a Western Star 4900XD-e machine in a trial application.

ABB developed an integrated charging infrastructure, with the latest charger technology and a future-proof automated connection device, while MEDATech created a battery-electric powertrain that includes a charge-reception system that can be integrated into any heavy-duty vehicle.

Together with MEDATech’s complete ALTDRIVE battery-electric vehicle system, ABB’s ultra-fast charging forms a complete electric vehicle package that helps OEMs move away from diesel, according to MEDATech. Integrating ALTDRIVE into new vehicle builds will enable OEMs to fast-track their battery-electric offerings, complete with ultra-fast charging.

Offering up to 600 kW of power, the eMine FastCharge solution was launched by ABB in September as part of its ABB Ability eMine portfolio of solutions.

ABB and MEDATech have previously worked together on the conversion of the Western Star 4900 tractor to battery-electric operation, but this is the first time the two have tested the automated charging functionality of the FastCharge solution on ALTDRIVE technology.

“Designed for the harshest environments, this flexible and fully-automated solution can easily be installed anywhere, and can charge any truck, without the need of human intervention,” Mario Schmid, Project Lead Engineer at ABB, said.

Charging occurs with no help from machine operators, according to the companies. Drivers station their vehicles next to the charger and the ABB Ability eMine FastCharge does the rest. When the system senses a vehicle is near, it moves the connection pin into position and inserts it into the receptacle, carrying out charging in a fully-automated fashion.

With ABB’s charging capability matching charging cycles to the production, charging times of less than 15 minutes can be achieved, according to the companies.

On September 10, ABB and MEDATech announced the signing of an MoU to jointly explore solutions to decarbonise mining operations through charging solutions and optimised electric drive systems in BEVs for heavy-duty applications.

The post ABB, MEDATech demo fully automated fast charging solution on Western Star 4900XD-e appeared first on International Mining.

Author: Daniel Gleeson

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