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Can Deep-Sea Mining Solve The Battery Metals Supply Crisis?

Can Deep-Sea Mining Solve The Battery Metals Supply Crisis?

Authored by Tsvetana Paraskova via OilPrice.com,

The key metals necessary to…

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This article was originally published by Zero Hedge

Can Deep-Sea Mining Solve The Battery Metals Supply Crisis?

Authored by Tsvetana Paraskova via OilPrice.com,

The key metals necessary to advance the global energy transition will likely drive the next commodity supercycle.

Soaring demand for lithium, copper, nickel, cobalt, and aluminum could lead to a battery metal supply crunch as early as this decade, while surging prices could reverse a decade of cost declines, analysts say.  In a world increasingly focused on sustainability and ethically-sourced raw materials, some players in the metal mining industry believe that deep seabed mining operations in remote ocean areas could have a lower impact and lower costs than the land mining of key battery minerals – minerals associated with child labor in the Democratic Republic of Congo, for example, the world’s top producer of cobalt.  

However, deep seabed mining is years away from commercial operations, at best, due to a lack of international regulations and concerns about the environmental impact of mineral extraction from the seabed in areas and ecosystems that are yet to be studied by marine biologists. 

Some companies are betting on starting deep-sea mining in a couple of years. The Metals Company, for example, which just began trading on the NASDAQ, said last week it is working to “move the world’s largest estimated source of battery metals into production.” 

“We believe we have a solution that is more scalable, secure, lower cost and lower impact than mining these minerals on land: We can produce battery metals from high-grade polymetallic nodules found on the seafloor in the international waters of the Clarion-Clipperton Zone,” Gerard Barron, Chairman and CEO of The Metals Company, said. 

Polymetallic nodules contain four essential battery metals—cobalt, nickel, copper, and manganese—in a single ore, and they have been formed over millions of years by absorbing metals from seawater. Those nodules lie unattached to the seafloor, and The Metals Company plans to use a robotic collector to gently dislodge the metal-containing rocks from the seabed with minimal disturbance to the ocean floor. 

TMC has exploration and commercial rights to three contract areas which host an estimated 1.6 billion tons (wet) of polymetallic nodules containing high-grade nickel, copper, cobalt, and manganese, in the Clarion Clipperton Zone of the Pacific Ocean—between Mexico and Hawaii—regulated by the International Seabed Authority.  

The company says its studies have estimated that the polymetallic nodules within its exploration areas are enough to electrify a quarter of the world’s passenger vehicle fleet, or would be enough for around 280 million EVs.

TMC says its proposed method of retrieving battery metals generates much less carbon dioxide than conventional mining and is more environmentally friendly. 

“It’s like picking up golf balls on a driving range,” CFO Craig Shesky told the IEEE Spectrum magazine edited by the Institute of Electrical and Electronics Engineers. 

With access to funding and the listing on the NASDAQ, TMC expects to be able to complete pilot nodule collection trials in 2022, complete environmental impact studies by 2023, and file to move from exploration phase to exploitation phase in the third quarter of 2023, CEO Barron said in the statement last week. 

Yet, TMC and other companies vying for deep-sea mining face strong opposition from environmental organizations that say disrupting the ocean would lead to losses of biodiversity and change the carbon cycle in the waters. 

Moreover, the International Seabed Authority (ISA) has not yet agreed upon regulations on how to manage and supervise the exploration and extraction of minerals from the ocean floor. 

The Clarion-Clipperton Zone (CCZ) is a “biodiversity hotspot,” Craig Smith, an oceanography professor at the University of Hawaii at Manoa, told IEEE.

Smith has led research expeditions to the CCZ, which have found species new to science. It’s not possible to mine polymetallic nodules without causing ecological damage “over tens of thousands of kilometers,” the oceanography professor says. 

“Deep-sea mining may irreparably harm ocean ecosystems before we even have a chance to fully study its impacts,” the Center for Biological Diversity says

Even some potential customers of metals extracted from the ocean supported earlier this year a call for a moratorium on deep seabed mining.  

Automakers BMW and Volvo, as well as Google and Samsung SDI, vowed not to buy metals produced from deep-sea mining until the environmental risks of the activity are “comprehensively understood.” 

Tyler Durden
Sun, 09/19/2021 – 08:10





Author: Tyler Durden

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Energy & Critical Metals

Pilbara Minerals Reaches Records Prices for Lithium Spodumene

Pilbara Minerals’ (ASX:PLS) third auction on the Battery Material Exchange (BMX) digital platform for 10,000t (SC5.5%) spodumene went off at a record…

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Pilbara Minerals’ (ASX:PLS) third auction on the Battery Material Exchange (BMX) digital platform for 10,000t (SC5.5%) spodumene went off at a record $US2,350/t.

It outshines auction two on September 14, which went off at a then-incredible $US2,240/t to singlehandedly spark a historic 86.5% month-on-month increase for average spod pricing industry-wide.

The average price for SC6% cargoes this time last year was ~$US380/t.

In the December half of 2020 – when pricing was still weak — Pilbara Minerals sold 114,239t of spodumene concentrate in contracts for revenues of ~$59m.

It has now raked in ~$US54m alone from these three spot cargoes totalling 28,000t.

“As with the previous two auctions, strong interest was received in both participation and bidding by a broad range of buyers,” Pilbara Minerals says.

“Parties placed 25 bids online during the 45-minute auction window, with the Company considering the bidding to be very strong in light of the deferred delivery date.”

 

 

The post Pilbara Minerals just sold the most expensive cargo of lithium spodumene ever appeared first on Stockhead.

Author: Reuben Adams

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Precious Metals

Stocks, Bonds, Bitcoin, & Bullion All Bid As Billionaire Tax Threat Builds

Stocks, Bonds, Bitcoin, & Bullion All Bid As Billionaire Tax Threat Builds

First things first, when is a wealth tax not a wealth tax?…

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Stocks, Bonds, Bitcoin, & Bullion All Bid As Billionaire Tax Threat Builds

First things first, when is a wealth tax not a wealth tax? When Janet Yellen says so…

The proposal under consideration from Senate Finance Committee Chairman Ron Wyden (D., Ore.) would impose an annual tax on unrealized capital gains on liquid assets held by billionaires, Treasury Secretary Janet Yellen said Sunday on CNN.

“I wouldn’t call that a wealth tax, but it would help get at capital gains, which are an extraordinarily large part of the incomes of the wealthiest individuals and right now escape taxation until they’re realized,” Ms. Yellen said.

But House Speaker Nancy Pelosi told CNN:

“We probably will have a wealth tax.”

But markets either a) don’t believe a word of it (given the relationship between all these billionaires as benevolent overlords of the political class), or b) don’t give a shit as The Fed will always be there…

And nowhere is this craziness more obvious than here. While Trump’s SPC (DWAC) stalled today (after rallying 800% in 2 days), TSLA and BKKT took over the crown of momentum-driven insanity kings

TSLA topped the trillion-dollar market-cap level for the first time (TSLA was up more than 1 GM today) on headline about HTZ ordering 100,000 TSLA vehicles…

Surpassing FB (ahead of tonight’s earnings) to join the ‘cuatro comas’ club…

Source: Bloomberg

All on the back of a massive gamma bomb.

@Stalingrad_Poor exclaimed:

“TSLA call options strikes up $10,000 in a single day. I’ve never seen this in my life”

NOTE: If unrealized gains are taxed as income (as several Democrats have indicated), Elon Musk would face a $30 billion tax bill for his gains this year!!

And BKKT soaring over 160% on its partnership with Mastercard on crypto rollout…

Bitcoin and Ethereum were both up today on the Mastercard news (and Neuberger Berman has linked up with BlockFi).

Bitcoin topped $63,500…

Source: Bloomberg

And Ethereum rallied back above $4200…

Source: Bloomberg

All the major US equity indices were higher today, led by Nasdaq and Small Caps. The Dow lagged but still closed green…

Record intraday (and closing) highs for The Dow and S&P today.

On a side-note, the S&P/TSX Composite rose again today – a record 14th straight daily gain (a record that stood for 102 years)…

All thanks to yet another major short-squeeze….

Source: Bloomberg

Utes and Financials lagged today while Consumer Discretionary and Energy ripped…

Source: Bloomberg

Treasuries were mixed today with yields lower across the curve aside from 30Y…

Source: Bloomberg

The yield curve (5s30s) steepened back into its recent range…

Source: Bloomberg

The dollar rallied on the day to the top of its recent narrow range…

Source: Bloomberg

WTI hit a new 7-year-high today above $85 before fading back into the red…

Gold jumped back above $1800…

Real yields dropped a little today, leaving room for a considerable move higher in gold still (to around $2000)…

Source: Bloomberg

Finally, the level of “greed” in the market is back at 2021 highs…

Source

“probably nothing” – oh and don’t forget that the last time capital gains taxes were hiked significantly was 1987 (from 20% to 28%) and that didn’t end so well eh?

Tyler Durden
Mon, 10/25/2021 – 16:00



Author: Tyler Durden

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Base Metals

Monsters of Rock: Lithium shares flush with positive sentiment to dominate the gains

Lithium miners were the kings, queens, jacks and aces of the bourse on an avalanche of positive news around the … Read More
The post Monsters of Rock:…

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Lithium miners were the kings, queens, jacks and aces of the bourse on an avalanche of positive news around the sector.

The biggest trigger was probably the incredible rise in value for Tesla overnight, which soared beyond a US$1 trillion valuation on news Hertz would order US$4 billion worth of electric vehicles from the automaker.

As the leading electric vehicle maker in the western world, and with a big presence also in China and energy storage, Tesla is one of the biggest end users of lithium products globally.

Its boss Elon Musk, now the richest man ever, has a fair bit of sway on the market as well.

On top of that Pilbara Minerals (ASX:PLS), up 525% over the past 12 months since spodumene prices bottomed out at under US$400/t (it sold a batch for upwards of US$2000/t last month), gained 7.66% after formally announcing plans to develop a lithium chemical plant in a JV with South Korea’s POSCO.

Core Lithium (ASX:CXO) declared the start of construction on its Finniss Lithium Mine in the Northern Territory. That will be shipping concentrate from the end of 2022.

$550 million capped Neometals (ASX:NMT) was up 14% after announcing its battery recycling demonstration plant in Hilcenbach, Germany, had been fully commissioned.

The one time lithium miner is up 405% over the past year.

Vulcan Energy (ASX:VUL), Sayona (ASX:SYA), Liontown (ASX:LTR) and Orocobre (ASX:ORE) were among the lithium miners to dine out on the day’s news, while rare earths miner Lynas (ASX:LYC) was also up.

On the flippity flip, iron ore miners were weak with Fortescue (ASX:FMG) and Rio Tinto (ASX:RIO) cancelling out a gain from BHP (ASX:BHP), while Mineral Resources (ASX:MIN) cancelled out the gains it made with yesterday’s announcement the Wodgina lithium mine would be coming back online with news it ate a 48% price discount on iron ore sales in the September Quarter.

MinRes’ average realised prices fell from US$178/t to around US$78/t between the June and September Quarters.

The bright green is all lithium baby. Pic: Commsec

 

Base metals inventories falling, but can it be sustained?

Base metals were back up on Monday, with production cuts in energy starved China and Europe hitting primary supply.

Inventories held by the major exchanges are being chewed up.

While price moves among the miners was muted, nickel rose 3.2% to climb back over US$20,000/t overnight after hitting US$21,000/t briefly last week.

“Nickel rallied after Eramet disclosed a 19% drop in ferronickel production from its operations in New Caledonia,” ANZ analysts said in a note.

“The market is also showing signs of tightness, with cash contracts closing at their biggest premium to futures in two years. LME inventories are down nearly 50% since April.”

LME stockpiles for copper hit their lowest level since 1974 last week, but Commbank analyst Vivek Dhar says it is too early to say whether the market is as tight as it seems, or whether some traders are hoarding to capitalise on high prices.

The market is expected to be in a small deficit at the end of this year to a 328,000t surplus in 2022 on rising supply (about 1.3% of global demand).

Mined supply is expected to increase 2.1% this year and 3.9% in 2022, but Dhar warned copper miners had a history of underwhelming.

“The rising forecasts for copper mine production reflect 5 major copper projects due to arrive by the end of 2022,” Dhar said.

“That compares with just two major copper projects in the last 4 years.

“Given the track record of mine disruptions (i.e. labour strikes, power and water scarcity and geopolitics) and the decline in copper grades, elevated copper mine production growth forecasts don’t tend to last long.

“We think it’s worth considering that new mine supply may take longer than currently expected to hit the market.”

The post Monsters of Rock: Lithium shares flush with positive sentiment to dominate the gains appeared first on Stockhead.







Author: Josh Chiat

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