Lake Resources Tapping Cleaner Lithium For Electric World, Looking to Gain From Looming Supply Crisis

  • Jul 16, 2020 AEST
  • Team Kalkine
Lake Resources Tapping Cleaner Lithium For Electric World, Looking to Gain From Looming Supply Crisis

Summary

  • Vehicle manufacturers are re-thinking their product strategy amid increasing carbon footprints and escalating pollution levels.
  • The revolution for electrification of the global transport industry is supported by various subsidy schemes of the global Governments.
  • Lake Resources is suitably placed to produce high-quality lithium that is required by EV manufacturers.
  • Lake Resources looks forward to benefiting from the limited supply of lithium on a global level, backed by the potential of its strong lithium projects.

From transforming weather patterns threatening food production to rising sea levels that increase vulnerability to disastrous floods, the global impact of climate change has been spanning in an unprecedented manner over the years.

The cumulative levels of carbon footprint and human fingerprint on greenhouse gases have escalated to record levels with growing economies as well as rising standards of living. A major cause of the increase is believed to be the way human beings transport on a daily basis.

Researchers agree that electric vehicles shall play a pivotal role in managing dual problems of poor air quality as well as climate change since they have zero tailpipe emissions. It is said that climate change is the defining issue of these highly vulnerable times, and the human race is at a crucial moment, set to bring a change to this agony.

Importantly, it is also the time with a dire need to focus on the lithium-ion batteries that shall empower a significant number of vehicles in some 5-10 years from now, which World Economic Forum expects to be some 30 million EVs globally by 2025.

This huge target of EVs by 2025 and further demand expected beyond this point has presented significant opportunity for lithium producers like Lake Resources NL (ASX:LKE).

LKE Well Positioned As Supplier Of High-Purity Lithium

Lithium exploration and development company, Lake Resources NL has been engaged in the production of cleaner, sustainable, high-purity lithium from its flagship Kachi Lithium Brine Project, well supported by three other lithium brine projects in Argentina. Lake collaborates with its tech partner Lilac Solutions for using its efficient, disruptive, clean and direct extraction technology.

Over the coming times when developmental activities advance further, LKE is expected to be positioned as an efficient, responsibly sourced, environmental friendly and cost-competitive supplier of high-purity lithium, which is readily scalable, and in-demand from Tier-1 electric vehicle and battery manufacturers.

Related Read: Lake Resources Zooms ~9% on ASX; New Research Reflects Kachi Project’s High Potential

LKE recently participated at the Noosa Mining Virtual Conference where the Company announced another step towards the delivery of high purity, responsibly sourced lithium. The Company has successfully produced the first samples of lithium chloride from the direct lithium extraction pilot plant module of Lilac Solutions.

Source: LKE's ASX Update

The samples show high lithium concentrations and are presently being analysed by external laboratories. Moreover, LKE looks forward to producing one lithium chloride sample per week, which can subsequently be transformed into lithium carbonate and then dispatched to potential off-takers.

Must Read: Lake Resources Produces Initial Samples of Lithium Chloride, Samples Indicate High Lithium Concentrations

Also, a compelling and robust Pre-Feasibility Study (PFS) was completed into the technical and economic viability of Lake’s Kachi Lithium Brine Project. The PFS exhibits that the project has significant potential to deliver high purity product needed by battery manufacturers, based on a sustainable and scalable process.

Source: LKE's ASX Updates

Details of the PFS Can be Read Here: Lake Resources Concludes Kachi Project’s PFS, Robust Results Further Strengthen Project Prospects

Changing Momentum Towards Electrification of Global Transport

LKE believes that there is a momentous shift towards the electrification of global transport, as seen by new lithium-ion battery megafactories. This is supported by the commitment of 1 billion British pounds of funding towards building a lithium-ion battery megafactory by the UK Government.

Moreover, 142 battery megafactories are currently being built globally, while the market size has increased fourfold since 2015 on the back of the EV revolution.

Other than this, the Chinese Government launched several policies to stimulate the automotive market, where incentive schemes were released in 10 cities, including Guangzhou that declared a subsidy of 10,000 RMB for New Energy Vehicles sold between March and the end of December.

More at: Lake Resources Optimistic on Lithium Outlook; Update from Investor Stream Interview

In addition to this, State-level subsidy to New Energy Vehicles was extended until 2022. Earlier, this was expected to phase out by the end of 2020.

But how is LKE placed amid the rising demand for EVs?

The shifting interest of the Governments, as well as consumers, means that the real opportunity for vehicle manufacturers now lies in the shift from internal combustion engines to cleaner, electric vehicles. Undoubtedly this has been supported by the close collaboration between the Government as well as industry.

Notably, once the lithium has been removed using ion-exchange beads without affecting the chemistry, LKE’s direct extraction process then reinjects brine, which translates to a much smaller footprint and minimal water usage without using evaporation ponds.

LKE looks like suitably placed for the advantage of larger electric vehicle makers and an increasing number of battery/cathode makers as they demand a sustainable and scalable future lithium product. This would not only result in increased demand of lithium but also help to build back a better world after a significant dislocation due to COVID-19.

Related: Lake Resources’ Technology Partner in California Picks Up Steam After Restrictions are Lifted

LKE has identified a looming crisis in the supply of high purity lithium and believes that there is a need for a disruptive technology solution to deliver the huge volume demand.

Overall, LKE has been surpassing various major milestones in its journey to deliver high purity lithium. Moreover, LKE looks forward to producing lithium carbonate samples that can match the product quality requirements of large off-takers.

On 16 July 2020, LKE stock last traded at $0.039, up 2.632% intraday with a market capitalisation of $25.52 million.  

 


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