Nevada Energy Metals locks in ground at world’s lithium hub
Nevada Energy Metals (TSXV: BFF | OTC: SSMLF) website includes two questions: “Why Nevada?” is one. The second is “Why Lithium?”. Well, we know the answer to the second. The first also, probably, but just in case you need to know, the answer is that Nevada, according to the company, is the US state that is “becoming a hub for manufacturing for energy storage, clean energy and greener transportation that could one day be as important as silicon”.
This is background to the announcement this week by Nevada Energy Metals that it has acquired 60 claims (covering 484 hectares) in Clayton Valley, located in Esmeralda Country, Nevada. This acquisition, known as the Clayton Valley BFF-1 Lithium Project, lies just 250 metres from Albermarle Corporation’s Silver Peak lithium mine and brine processing operations. Nevada Energy Metal’s new ground is also near that area where Pure Energy Minerals (TSXV: PE) has a 816,000 tonnes inferred resource of lithium carbonate equivalent.
Just as importantly, the new project is just 3.5 hours travelling time from Tesla’s gigafactory (which has planned annual lithium-ion battery capacity to produce 35 gigawatt hours a year from 2020).
But there’s a wider picture, too. America needs more lithium.
Think all those US Department of Defense studies on critical metals supply. Think all those critical metals – including scandium, manganese, indium and graphite – where America is 100% dependent on imports. Lithium is now on the radar: the Defense Logistics Agency in 2015 announced plans to acquire 150kg of lithium cobalt oxide and 540kg of lithium nickel cobalt aluminium oxide. In 2015 the US imported 2,980 tonnes of lithium, representing a 60% net import reliance, according to the US Geological Survey.
Thanks to Albermarle, the US is not entirely dependent upon exports for lithium, Silver Peak has been in operation since 1967 but that’s still it.
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There is also the question of reserves. According to the US Geological Survey, the country has known reserves of 38,000 tonnes of lithium. Contrast that to the major players: Chile has 7.5 million tonnes, China 3.2 million, Argentina 2 million and Australia 1.5 million. (The USGS does not list Bolivia; it certainly is assumed to have vast brine resources but just how much is not known.)
Nevada Energy Metals says Clayton Valley is one of the few locations globally known to contain commercial grade lithium-enriched brine. The aquifer system is host to those brines which are contained by the surrounding rock. Exploration will begin in the autumn/fall.
The company, answering the question “Why Nevada?”, says the state (being home to North America’s only brine-based producing lithium operation) is now (along with the gigafactory) being seen as a “lithium hub”, and likens the land grab going on there as similar to California’s gold rush.
Tesla Motors’ $5 billion gigafactory will, when completed, be the world’s second largest building by volume, and the biggest lithium-ion battery factory in the world. The factory is expected to generate $97 billion in terms of economic activity for Reno, Nevada.
Nevada, apart from having what is claimed to be the second largest lithium supply (next only to Chile), and also being what the company calls “a hot-bed of renewal resources such as wind and solar”, ranks highly as a place for mining companies to do business. In the 2015 survey of executives of 3,800 mining companies worldwide, Toronto-based Fraser Institute rated Nevada the globe’s third most attractive mining jurisdiction (after Western Australia and Saskatchewan). Nevada beat out Ireland, Finland and Alaska as the next most popular.
(If you need to know, Venezuela and Argentina’s La Rioja province were at the bottom of the list.)
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