Sunday 23 October 2016

International Lithium and Ganfeng: Major Catalyst For Electric rEVolution And Security Of Lithium Supply.


  We have discussed before the fast changing geopolitical landscape in the world and why New Energy Plan in China can change the balance in our world's economic system just in a few very short years. For more than 100 years oil was our only major source of energy powering the economic growth. Oil means power and power means oil - this sentence can determine the politics of all 20th century. But not anymore. We are just at the tipping point of the major tectonic shift from the centralized energy systems to the distributed electricity  generation and its consumption when we want it. Electricity is the most efficient form of energy known to us. Now, thanks to "The Learning Curve", we can produce it very cheap with solar and wind and we can store it very efficiently using lithium batteries. Cheap lithium batteries change everything here. We are in the catalyst stage of moving from 2 to 7000. 2 is the number of batteries in your farther's first remote control, 7000 is the number of lithium batteries in Tesla Model S. 
  Tesla is making the headlines demonstrating the potential of lithium technology. Elon Musk has proved that electric cars are just better. Here comes the China's New Energy Plan in the picture as the major driving force for The Switch with its state-level military style planning and execution - you can find more details about it in my previous posts. 
  Two major Chinese companies Ganfeng Lithium and Tianqi are part of this state-level plan to build the Electric rEvolution from top to bottom, including the secure supply chain for the critical metal Lithium which is at the very heart of this technology. This year they have broken "The Old Lithium Big 3" and now we have "The New Lithium Top 5". Albemarle is in the first place and SQM is holding now to the second. Ganfeng Lithium and Tianqi have pushed FMC into the 5th place and are chasing each other between 3rd and 4th. Ganfeng Lithium is a $4.5 Billion MC company and strategic partner of International Lithium. We were very fortunate after two years of due diligence to strike the major deal with Ganfeng for International Lithium in 2011. This business demands a long term planning and stamina just to stay with the game. This year, after 7 years of building our business, we are celebrating with Ganfeng the 5th anniversary International Lithium's IPO.

Mr. Li Chairman of Ganfeng Lithium and Mr. Klip President of International Lithium Corp.

 Ganfeng holds 15% stake in ILC and finances our J/V projects in Ireland And Argentina. It is providing not only capital to advance the projects, but a technology to extract lithium at the right chemical specification for Ganfeng as an end user. A lot of people even in the mining industry jumping into the lithium story now forget that lithium extraction is a chemical process.
  "Ganfeng has a strong commitment to supply Lithium product to various industries worldwide,” stated in the recent article Ganfeng’s Director, Wang Xiaoshen, “so we clearly have a vested interest in these projects and have been very hands-on in the evaluation of ILC’s properties. Our company is the only one in the world that has commercial production capacities to extract Lithium from both brine and spodumene, and we continually implement cutting-edge technologies to our processes. I feel confident that this is a fit for our operations and the potential these projects hold."

   People listening to our story are often asking me: Why is Ganfeng growing so fast? Here in the West, we can see the only top of the iceberg - the center of Lithium Universe is already in China. We have the major catalyst and tipping point for Electric Cars to go mainstream - Tesla Model S is outselling by a wide margin all other luxury sedans in the US and Western Europe. Automakers are just terrified with coming Tesla Model 3 priced at $35k and with over 200 miles of range. But wait to hear what is happening in China: now 25 companies are making 51 models of EVs over there. BYD: the company backed by Warren Buffett - will sell 100,000 EVs this year. It took GM 7 years from 2009 to sell 100,000 of Chevy Volts. Tesla will sell 80,000-90,000 EVs this year. We can have 1,000,000 electric cars sold this year alone and we will definitely get 2,000,000 EVs on the road by the end of 2016. This is the catalyst - during all our history we sold just over 1,000,000 EVs and this year alone we can make this number!
 Now let's have a look at what is happening in Germany now. Thanks to the best advertisement campaign for electric cars  made by Volkswagen and Dieselgate, Bundesrat has decided to ban all fuel powered cars by 2030 following Netherlands and Norway who would like to do it from 2025. German lawmakers are calling now to implement this ban all over the EU.
  After DieselGate Volkswagen has introduced Electric ID and is talking about 20 models of electric cars by 2025; Audi will make 4 EVs; Mercedes has introduced Electric EQ brand and is talking about 10 EVs. BMW has patented full-electric BMW i5 and increased the range of BMW i3. In September BMW i3 was the best-selling EV in Germany with more than 7,000 sold.

  GM Bolt is coming now this Fall in the U.S. priced below $40k and with over 200 miles range. In Europe, it will be sold as Opel Ampera-e from the next year with 500km of range. Renault Zoe will get the new lithium battery for 400 km of range, Nissan Leaf is getting battery upgrade as well. 
  We are all reading the headlines about the breakthrough in Solar technology and record low costs for the new installations. Lithium Technology is making renewable energy work 24/7 with utility scale and home battery storage systems. 
  Energy storage is the topic for another conversation and I will only mention that it will consume even more lithium batteries than EVs in the future. All this demand is driving by not only Tesla Gigafactory but other Lithium Megafactories all over the world. In 2014 there were 30 GWh of lithium batteries produced all over the world. Now Tesla will produce 50 GWh by 2018 and 150 by 2022. Lithium Megafactories in China will produce 120 GWh by 2018-2020. Very serious names are involved now in this business with billions of dollars being invested: BYD, Foxconn, CATL, Boston Power, Panasonic, Samsung, A123, LG Chem among many others. In Europe, this momentum is gaining strength as well with BMZ, LG Chem, Mercedes, and Volkswagen talking about $11.2 billion dollars investment in its own Megafactory. All they will consume lithium. Goldman Sachs estimates that by 2025 we will see 3 times as high demand as we have now.

 Ganfeng and International Lithium are building the vertically integrated business  model to provide the secure supply of lithium. In the West, we will get the best electric cars for The Switch within next few years starting with GM Bolt and Tesla Model 3, but the real lithium game is happening now in China. China is already the largest market for lithium chemicals for the batteries. Ganfeng has a unique position with its Lithium Hydroxide production capacity: this particular product is used in Tesla lithium cells produced by Panasonic now. Ganfeng supplies both Panasonic and BYD among many other battery makers. Joe Lowry has just published his new article on the major lithium players featuring Ganfeng and you can get a better picture about the state of lithium market and place of our strategic partner in it. International Lithium is vertically integrated with Ganfeng as its exploration arm. 
  The same approach we are using with Pioneer Resources in Canada to build the secure supply of lithium for the North American market. Here our approach is to define Upper Canada Lithium Pool - multiple high-grade potential deposits with one central processing plant located right next to the auto manufacturing base in Northern America. 

  This year we have CAD$17 million budgeted for all our projects on 3 continents, which makes International Lithium one of the most active lithium development companies in the world. Very deep technical team and diversified portfolio of high-quality lithium assets have attracted to International Lithium major leaders in the lithium materials industry and they became our strategic partners. We have capital and technology in place which are necessary to develop our projects. 
  On the links below you can find more information about our company and Energy rEVolution. Please carefully read my legal disclaimer and never make any investment decisions without consulting you preferred qualified financial adviser. All latest information on International Lithium can be found on SEDAR, SEDI and website of our company.

Lithium Market Small But Complex. Canadian Junior And Chinese Partner Taking Long View.

This brings the total amount budgeted for exploration to CAD$17 million across the Company’s projects in CanadaArgentina and Ireland, making International Lithium Corp. one of the most active exploration companies in the lithium sector.  This speaks volumes for the quality as well as the potential of the Company’s projects,” states Kirill Klip, President, International Lithium Corp.”

International Lithium At Wentworth 2016 Presentation.

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