Comet Resources Relishing The High Tides Of Burgeoning Market Opportunities As Demand For Battery Commodities Booms

Comet Resources Limited (ASX:CRL) through its existing Springdale Graphite project and proposed Barraba Copper project appears to conquer the market opportunities offered by battery commodities space. As the energy market seems to be brimming, the growth trends concerning the commodities seem to give shining hopes to the current and planned endeavours of the company.

Demands for Graphite and Copper Skyrocketing

The demand for graphite has escalated, bolstering the viability of the Springdale project with respect to the market opportunities.

As the global drive towards the emission reduction takes its full force, the use of the Battery Electric Vehicles (BEV’s) takes a reckoning surge, soaring up the demands of the battery commodities. EV models are expected to increase from 179 at the end of 2018 to 230 models by 2021 (Bloomberg).

BEV’s contribution to the Copper Demand

• BEV’s utilise four times copper compared to the conventional internal combustion engine vehicles.
• The future BEV’s which are longer ranged would utilise even more copper.
• The utilisation of copper is not only limited to the batteries, but the motor windings of the electric motors responsible for driving BEV’s wheels also use copper.
• According to Bernstein Research, solar and wind energy is up to 37 times more copper intensive, compared to the conventional power generation. The global low carbon revolution brings forth the alternative of non-conventional energy sources.

But is Supply Enough?

The growing demand for battery commodities requires a consistent supply of graphite and copper over the coming years. However, the forecasts highlight a shortage in the supply of commodities.

• The shortage in the graphite supply is forecasted to begin from the year 2021 (Source: Benchmark Minerals Intelligence).
• By 2030, S&P Global Market Intelligence forecasts the supply deficit of 5.7 Mt per annum for copper, accounting for 28% of the estimated copper demand.
• Comet believes in tapping the lack of a sufficient amount of copper discovery to meet the demand.
• According to Comet, Copper is positioned at the start of a new upward cycle with deficits in supply forecast from 2024.

Project Portfolio Positioned To Tap The Attractive Market Prospects

Springdale Graphite Project- The project is located proximate to Esperance in South West Western Australia. The assays following the completion of the diamond drilling program have resulted high-grade graphite at multiple broad zones. The project exhibits a maiden inferred resource of 15.6Mt @ 6% TGC. A highest grade of 3.23m @ 51.02% Total Graphite Carbon (TGC) is returned from the broader 42.5m @ 17.02% TGC. Supported by the good infrastructure incorporating piped gas, grid power, etc. and the government approval secured, the project, with high grade graphite focus to supply global niche markets, offers robust growth opportunities.

Key Developments:

• Diamond Drilling Completed
• Electromagnetic Survey identified priority targets with high-grade graphite mineralisation.
• Ongoing metallurgical testwork for establishing graphite recoveries.
• Received Government’s R&D grant of $480k.

Barraba Copper Project- Barraba project lying in the Peel Fault Zone encompasses historic copper exploration region. Exciting drill targets along the strike from Gulf Creek and at depth has been reported by the Barraba projects pre-transaction review. Targets are prospective for Copper and other precious and base metals rich volcanogenic massive sulphide mineralisation (VMS).

Comet recently received a firm commitment of $2 million in relation to the acquisition of the Barraba project.

Outlook-Moving Ahead To Conquer The Opportunities

• Results of metallurgical testwork on Diamong Drill core expected by Q1/2 2020.
• Initial Drilling on the Barraba project to begin in Q2 2020.
• International testwork would commence in Q1 2020. It would help to analyse the gamut of off-take markets and assess the value-add potential of Springdale’s graphite.

Comet Resources seems to be well positioned with the potential to derive key advantages from the global drive for emissions reductions, backed by attractive projects, including Springdale graphite project, and the proposed Barraba Copper project acquisition.

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