Ganfeng & The Lithium Industry Reshuffle: TNR Gold Plugged Into The Tesla Energy rEVolution With Lithium And Copper Royalties.

Guest post: 

Ganfeng & The Lithium Industry Reshuffle: TNR Gold Plugged Into The Tesla Energy rEVolution With Lithium And Copper Royalties. 

Konstantin Klip

There's been two great developments for us at TNR Gold lately. 

The first was BP’s instrumental report highlighting peak oil potentially being behind us and Looney’s desire to have his giant invest 10x more in renewables. With EV’s picking up the title of New Normal, the times are already good for lithium. Even better is national grids considering renewables the New Normal as well. 

We start to see lithium blessed by a confluence of not only extreme demand from the rapid electrification of mobility systems but also demand out of responsibility towards providing stability to otherwise volatile renewable energy systems (especially Wind & Solar). The latter development will provide lithium demand on a different magnitude to EV’s.

The real business for lithium & Tesla is utilities - by now you can recite my justifications by rote, so here’s a circumstantial update: 

Earlier in the year, Tesla gained energy license and integrated with German utilities, now it has done the same in the UK. A quote from Musk on the matter below.

Electrek

Talk is good, especially when it’s made by BP and Tesla, but money’s better. Here comes Ganfeng then with the real money while the West jibber-jabbers about needed stimulus and forecasted mass infrastructure investment (we will jibber-jabber ourselves on this point at a later date). 

We see Gangfeng lease three more plants to become the largest global lithium hydroxide producer. Looking at Ganfeng’s Interim Report 2020, this move is exactly the type of discipline in opportunism we regard so highly when it comes to Chinese companies and their lithium plays. The move grants Ganfeng 65% of total Chinese chemical conversion capacity, boosting it up to top place in world rankings for chemical conversion. 

Suddenly, Ganfeng’s earlier plays fall into place as well, as increased chemical conversion calls for more raw material input. So we read on and see Ganfeng moving forward with its Mariana Lithium project, including finally designing plant construction on a project that had been laying patiently out of the spotlight before it’s resource estimates suddenly "increased by more than 250%". 

Those few sages of our industry are aware that Lithium leaves only the most patient & opportunistic companies to survive until the always prophesied electrics switch. In 2009, TNR Gold saw that companies needed not only the passive resilience to survive lithium market properties, but also the active confidence to pursue opportunities that would pay off a strategic edge many years later from the decision. Our royalties were chosen per that thinking.

We believe the same play is in copper. While few non-Mandarin speaking entities possess the required confidence in lithium, the West is much more open to the idea of a traditional metal like copper. Our chosen positions of participation, again, reflect that. 

The lesson that needs to be learned, for those missing out, is to see the market for an opportunity to gain an advantage before the metal sees the respect it deserves. This respect will come from the favourable congruence of industry disruption, as we already see with the electrification of not only mobility systems but utilities as well.

A bet on lithium & copper is a bet spread between Tesla’s and FAA(N)G’s integration of grassroots EV storage potential and a more immediate solution of installing macro battery storage to account for renewable shortfalls in reliability. 

You can find more information about TNR Gold and our rEVolution Royalty Holdings portfolio on this blog. And below are my previous articles providing more in-depth observations for this Energy Transition and its dependence on the critical commodities.

The rEVolution Feeding Frenzy and the Shadow Beneath: Lithium-Ion Batteries and the Next Leap Forward.

Daimler, The End Of The Internal Combustion Engine And The Curious Case Of Plug-In Hybrids.

Powered By Tesla Energy rEVolution: Why Gold And Green Energy Metals? Why Royalties? And Why TNR Gold?

Thank you for coming back!

Thank you for coming back to me here. Today I would like to thank all our shareholders and followers who are supporting our GEM Royalty TNR Gold Team. These very talented people are working very hard to make our dreams happen. The future is here, not everybody can see it yet, but megatrends are manifesting themselves. The Switch. Tesla Energy rEVolution. The recalibration of the global financial system and Gold - like The Ultimate Hedge for these uncertain times. 

Our Story.

It is time to tell you our Story about TNR Gold with all recent developments today. This is my personal story, I am putting my money where my mouth is. Please never forget that you will have to find your winners. You will have to travel on your own journey. I am just sharing my travel notes with you in my diary. I am glad if you can share the beautiful scenery with me. Join. You will learn new things. And I am ready to learn as well. Fasten your seatbelt and, please, always make your own due diligence and consult a qualified financial adviser before any investment decision. 

We are building The Green Energy Metals Royalty and Gold Company and I hold a 25% stake in our Company on a partially diluted basis now. TNR Gold has a very tight float with all insiders holding well over 50%, including NovaGold's stake in our Company. 

This year was very tough for us all, but we used our "time at home" wisely. The Company has received a clean bill of health from TNR Gold Auditors and I have received my newly acquired block of shares. Freshly printed maps with Shotgun Gold claims in Alaska are ready for the major Gold mining companies to make their Due Diligence to open the new chapter for our Company.

Why Green Energy Metals, why Royalties and why TNR Gold?

Let's tell you first what we have done already. Tesla is huge now - everybody knows about Tesla finally. Is it too late to play the stock which was already launched by Elon Musk, a genius traveller from the future, to the moon? I don't know. What about Lithium for Tesla and all other electric cars? A lot of people are looking upstream now on the supply chains for electric cars. This is where our partner is coming into this Energy rEVolution picture. 

Ganfeng Lithium is the largest integrated lithium producer in China and just recently became the largest Lithium Hydroxide producer in the world. Ganfeng is already a huge story itself and supplies Tesla, VW and BMW. But only some people in the industry know about it, despite that, Ganfeng's stock chart was going vertical early in 2020. The stock almost tripled from Summer 2019. Now it looks like Ganfeng has managed to shake of pandemic fever already as well.

What is GEM Royalty TNR Gold? We are building The Green Energy Metals Royalty and Gold Company. We have Royalty Holdings in the projects with industry leaders like Ganfeng Lithium and McEwen Mining in Copper. We do not have to contribute any capital to develop these giant projects. Even more, we have companies like NovaGold who are holding their stake in TNR Gold.

GEM Royalty business model.

How does our business model work? TNR Gold started our Lithium Story in 2008, by 2010 Ganfeng Lithium has joined us. Ganfeng is investing Capital - many millions of dollars to build the Mariana Lithium JV project. 

This year we announced a new Lithium resource estimation provided by Ganfeng with over 250% increase of resources from 2017 estimation to well over 4M T of LCE at Mariana Lithium JV! This is very significant - almost nobody knows about it. TNR Gold holds NSR Royalty on the entire Mariana Lithium JV under Ganfeng development - almost nobody even heard about it. And the most important thing here is that we do not have to contribute any capital and dilute our shareholders to develop Mariana Lithium. 

TNR Gold is plugged into the Tesla Energy rEVolution with our NSR Royalty Holding on Mariana Lithium JV under the management of this giant from China. Ganfeng proposed USD $25 million budget for Mariana Lithium in 2020 and "The feasibility study on Mariana Lithium was completed in 2019, and environmental assessment and construction of the project are planned to be conducted," as they stated in Ganfeng Lithium 2019 Annual Report. 

Ganfeng Lithium has provided a further update on Mariana Lithium in 2020 Interim Report: "The feasibility study of Mariana Project in Argentina was successfully completed in 2019, and environment assessment, pilot scale test, and design of plant construction are being launched to the project."

And here we can come back to a simple personal fact, why does CEO buy TNR Gold shares? Because I personally believe that TNR Gold is very undervalued even at 5 cents. Some shares can still be bought now below 5 cents in the market. It is not investment advice, as you already know, just a pure scientific observation of the junior mining market landscape.

And what about Copper for Tesla Energy rEVolution?

Now we can talk about Copper for Tesla Energy rEVolution and EVs. We have discussed with you in-depth that Tesla rEVolution has already propelled Copper into the powerful Golden Cross and the significance of the break out above the $3 dollar Copper price. You already know that TNR Gold is plugged into this rEVolution and the coming mass market for Electric Cars with our NSR Royalty Holding on the entire Los Azules Copper project under the development by the legendary Mr Goldcorp - Rob McEwen. Recently Rob McEwen described in his own words the magnitude of the Los Azules Copper project for your further research: "Los Azules has resources of greater than 50 million gold equivalent ounces."

TNR Gold holds NSR Royalty on the entire giant Los Azules Copper with McEwen Mining. Legendary Rob McEwen is calling Los Azules - "Our sleeping giant". There is over 10.2 B lb of indicated and 19.3 B lb of inferred copper in all resource categories; plus 1.7 M Oz of indicated and 3.8 M Oz of inferred Gold resources; and 56 M Oz of indicated and 136 M Oz of inferred Silver resources. (Please never mix in your investment analyses different resource categories)

The mining world is relatively small and it is getting much smaller once you will account all capable people with the real money who can move giant projects like Los Azules Copper into the next stage. 

To add a few more pieces for this Energy rEVolution value play puzzle we must remember that Warren Buffett bought a $564 million stake in Barrick Gold. Barrick Gold is looking for a "Strategic Copper" and Rob McEwen is "derisking this asset (Los Azules Copper), improving the access, and improving its attraction for a potential JV partner": 

"Also, in Argentina is the company's large, 100%-owned Los Azules copper project. "To give you a sense of its size I will convert the pounds of copper to gold equivalent ounces (by dividing the gold price by the copper price, then take the product and use it to divide the number of Indicated and Inferred pounds of copper to arrive at the number of gold equivalent ounces) and to that number add the gold and silver ounces in the deposit. Based on current metal prices, Los Azules has a resources of greater than 50 million gold equivalent ounces. We have focused on derisking this asset, improving the access, and improving its attraction for a potential JV partner," Rob explained."

 

What else do we have in TNR? - GOLD. 

Shotgun Gold project is in the South-West of Alaska. It is located near the giant Donlin Gold project in the Alaskan "Elephant Country" with 39M Oz of Gold resources. CEO Mark Bristow confirmed that Donlin Gold JV project with NovaGold in Alaska is currently a key project for Barrick Gold. TNR has already found Gold as well and identified the initial inferred resources of over 700,000 Oz of Gold. 

All mineralisation is opened at depth and we have identified five similar geological and geophysical targets on the property. TNR is working to bring a major Gold company as a strategic partner - “Ganfeng in Gold” - to repeat the success of Mariana Lithium and Los Azules Copper with our Shotgun Gold project in Alaska now. 

"...company that holds a lithium royalty from Ganfeng, one of the biggest lithium names in the business, a copper royalty from McEwen Mining, also a major name, and which may also be sitting on a five million ounce gold project.

 

The upside is clear. Indeed, Novagold sees it well enough, since it retains a significant stake in TNR, and former Novagold director Greg Johnson now sits on the TNR board. How long it will take the rest of the market to wake up remains to be seen.

Nonetheless Klip is confident that this is a company that’s going places.

“We are not dreamers,” he says. “We did it with the copper. We did it with the lithium. I would like to make it even bigger with the gold. I would like to do better, to keep a 25% stake.”

NovaGold already holds a stake in TNR Gold. Greg Johnson - one of the founders of NovaGold - is on our TNR Gold Board. This year NovaGold announced that right of way and other crucial necessary permits were granted in Alaska. Donlin Gold is moving forward and will create the major Gold mining Camp on the US soil. TNR Gold is in that mining camp already with our Shotgun Gold project.

What is next?

Our Team at TNR Gold has a deep financial background as well. Our unique business model provides investors with exposure to Lithium and Copper - which are powering Tesla rEVolution, and Gold - like The Ultimate Hedge for these uncertain times. TNR shareholders will participate in the potential of blue sky discovery with our gold project and in potential royalty cash flows from the projects under development by industry leaders like Ganfeng Lithium and McEwen Mining. 

Nobody knows the future but potentially we can even see the situation when 3 major companies may be looking at TNR Gold portfolio for possible M&A activities reflecting our respective assets.

With Ganfeng JV - in Lithium, according to industry analysts, our NSR Royalty may represent in the future potentially millions of dollars per year as Royalty payments to TNR from Mariana Lithium JV after it will be in production (please note that Lithium Royalty calculation was made by the analyst before we have announced more than 250% increase of Lithium resource at Mariana Lithium). 

With McEwen Mining - in Copper. McEwen Mining is looking for a strategic partner to advance Los Azules as JV. According to industry analysts, our NSR Royalty may represent in the future potentially many millions of dollars per year as Royalty payments to TNR from Los Azules after it will be in production.

With NovaGold - in Gold, ShotgunGold is ready for the strong strategic partner to grow together in the Alaskan "elephant country" in the new major Donlin Gold mining camp under development on the US soil.

I will not be surprised personally, that after very hard work, we may see potentially some kind of M&A activities particularly with Gold, Copper and Lithium prices going up, our projects growing resources and moving forward towards further development and potential production.

I believe that TNR Gold provides the truly unique entry point for me personally to participate in the Tesla Energy rEVolution and Gold markets - The Ultimate Hedge which is providing solid values in uncertain times. This is why I am investing in TNR Gold every time I have the appropriate opportunity. 

The future is here, not everybody can see it yet. We are building with our GEM Royalty Team The Green Energy Metals Royalty and Gold Company. 

Join Energy rEVolution and Gold - follow TNR Gold. 

TNR Gold Investor Presentation from Kirill Klip

Please visit the TNR Gold website for all updated presentations.

Please always read legal disclaimer. There is NO investment advice on any Kirill Klip feeds and blog. Always consult a qualified financial adviser before any investment decisions. 

Do Your Own Research.

TNR Gold Royalty Holding On Mariana Lithium Project Operated By Ganfeng: "China’s Ganfeng To Be Largest Lithium Hydroxide Producer".

Update October 31, 2020:

"In a separate filing, Ganfeng said it had terminated a deal announced in August that would have seen it take over 25,000 tonnes of annual lithium carbonate and 5,000 tonnes of lithium hydroxide production from smaller firms including Jiangxi Special Electric Motor Co 002176.SZ.  

The two sides "failed to reach an agreement on the technological transformation plan for the lithium salt production lines" and opted to terminate the agreement, which would have run from this month to March 2023, it said." Reuters.

Ganfeng Lithium continues to build the Vertically Integrated Lithium Business Empire and increasing its lithium production capacity by this lease deal with Jinaxi Special Electric Motor. Apparently, Ganfeng can make things work even in the very tough markets where others seem to be just losing money and making strategic mistakes by taking on unbearable debt and overpaying at the top of the market for the "Get Big Fast" strategy with M&A deals.

Ganfeng becomes the largest Lithium Hydroxide producer in the world surpassing Albemarle after this deal. Needless to say, that Company is looking forward and getting ready for the exponential stage of growth for the sales of Electric Cars. Ganfeng has deals to supply Lithium to Tesla, Volkswagen and BMW among others.

We are entering the Post Carbon Economy. Even BP is warning its shareholders these days in its famous Energy Report: "Oil demand already peaked." Exxon is out of the DOW already and Tesla was roasting shorts alive with its parabolic surge defying all the laws of gravity before its long due correction the last couple of weeks. 

Only those who are ready and can cross the desert will be abler to enjoy the full power of this Energy rEVolution. High Voltage can be very unforgiving. The strongest are getting stronger and the weak ones are being wiped out from the Lithium Universe by the ruthless Mr Market these days. We are talking here about the new geopolitical balance in the world which will affect all trading and commercial relationships. The Global Village is over. New secure supply lines must be built for this Energy rEVolution which is electrifying $12 Trillion industries of Energy and Transportation. 

From the very early days, Ganfeng was paying very careful attention and building step by step its diversified Lithium raw material base. Earlier in September Company has announced the completion of its new JV deal with Lithium Americas in Argentina and now Ganfeng controls Kauchari-Olaroz Lithium project. This company knows how to operate in Argentina and used the opportunity to consolidate control of one of the largest Lithium brine projects in the world. 

TNR Gold is plugged into the Tesla Energy rEVolution with our NSR Royalty Holding on Mariana Lithium JV under the management of this giant from China. Ganfeng proposed USD $25 million budget for Mariana Lithium in 2020 and "The feasibility study on Mariana Lithium was completed in 2019, and environmental assessment and construction of the project are planned to be conducted," as it has stated in Ganfeng Lithium 2019 Annual Report. 

Ganfeng Lithium has provided a further update on Mariana Lithium in 2020 Interim Report: "The feasibility study of Mariana Project in Argentina was successfully completed in 2019, and environment assessment, pilot scale test, and design of plant construction are being launched to the project."

Tesla's battery Day on September 22 will bring batteries and lithium to the front pages in the world again. Do not miss this generational opportunity in the hydrogen fog - we have The World Just Before The Internet all over again. Below you can find more information about TNR Gold for your own research. 

TNR Gold Royalty Holding On Mariana Lithium Project Operated By Ganfeng: Lithium Resource Increased By More Than 250%, "USD $25 Million Budget Is Proposed For 2020".

Tesla has electrocuted shorts and now provided a near-death experience to all legacy automakers. The message is crystal clear: change or die all together with the ICE Age. All automakers are rushing to build up "the next Tesla killer", but nobody can really compete or come even close to the technology developed by Elon Musk and his very talented team at Tesla. 

Tesla Battery Day on September 22, 2020, promises announcement of a new breakthrough battery technology which can become "a million-mile battery"  that can bring the cost parity with ICE cars. We are moving in the fast lane towards the end of the ICE Age. Fisker is going public with his new electric car after $50 million dollars raise and reverse takeover which expected to bring $1 billion dollars to start production. Rivian, backed by Amazon and Ford, raised $2.5 billion dollars. One by one electric cars makers are launching their stocks "to the moon", sometimes even without any electric cars being in production yet. 

People are ready for The Switch, millions are switching from cancer hazard polluting "Clean DIEsel" and "Not so dirty Gas" cars to EVs. Mr Market will separate, as always, flies from hamburgers and a lot of people on Robinhood from their money, but do not miss the real tectonic shift. The World Just Before The Internet. We are going electric. A few megatrends are colliding and will produce real fireworks for the strategic commodities.

The Global Village is finished, globalisation is over. Painful reality check, after this wave of the pandemic will be closer to being controlled, will reveal that a lot of things will never be the same. This Switch will require new secure supply lines for strategic metals for this Energy Transition: Copper and Lithium. Dr Copper has been already celebrating electrification and the coming mass market for EVs by driving up the hill in his Tesla after reading all headlines about infrastructure stimulus. 

Master Lithium is still going through its teenager hangover after too much parting was done too soon. Change of mood is typical for all advanced chemistry products. A lot of speculative capital which was before allocated to junior mining space went up in smoke quite literally.

The noise of printing presses is still louder now than the heavy machinery buzz. The coming QE Tsunami is lifting the superyachts first and cargo ships will be the next. The smart money is getting into the real control step by step. 

$12 Trillion industries of Energy and Transportation will depend on $3 billion Lithium market more and more. At the moment the Lithium market seems to be totally separated from all excitement and electricity in the air intoxicating the happy Robinhood crowd which is chasing bankrupt ideas and insolvent companies. "Opaque Lithium Kingdom" is still under consolidation. Strongest companies are getting stronger and picking up pieces of all other companies and the best projects they can find on their terms. 

All weak players will be wiped out. Ganfeng Lithium is marching on building their own global Lithium raw material resources empire. Ganfeng's 100% ownership of Mariana Lithium is now closer with "Proposed budget 2020: US $25M" when the other JV partner "has decided to temporarily cease to make contributions to the Mariana Joint Venture" again. 

Now you can better appreciate the real magnitude of Mariana Lithium Project after the increase in Lithium resources of more than 250%. I am very pleased to see that this new proposed very significant budget will be moving the project into the next stage of the development. In their 2019 Annual Report, Ganfeng Lithium published: "The feasibility study on Mariana Lithium was completed in 2019, and environmental assessment and construction of the project are planned to be conducted". 

TNR Gold is plugged into Tesla Energy rEVolution with our Royalty Holding on Mariana Lithium Project. We do not have to contribute any capital for the development of Mariana and our NSR Royalty does not depend on the size of ILC's potentially further diluted ownership in the Mariana Lithium Project. Below you can find more information for your own research on this generational investment opportunity:

"Super-smart" banksters can understand even Mandarin as long as it is about "getting rich quick dirty ways to make money". But history will be the judge, as always, in this case as well after all legal lyrics are written and all guitar solos are recorded. The Rock n Roll time is here, Lithium Royalty payday is coming."

Bloomberg BNEF:

China’s Ganfeng to Be Largest Lithium Hydroxide Producer

• Ganfeng to expand lithium chemical capacity to 85,000 tons
• 65% of global lithium chemical conversion capacity in China

"Ganfeng Lithium announced an agreement with Jiangxi Special Electric Motor (Jiangte) to take over the operations and management of three lithium chemical converter plants from October 2020 to March 2023. Ganfeng will pay Jiangte $2.78 million to lease these assets, bearing full responsibility of all losses and revenues.

According to the deal, Jiangte’s three plants total 25,000 metric tons of lithium carbonate capacity, of which 10,000 tons is under construction (5,000 tons of lithium hydroxide capacity is also under construction). Gangfeng currently has lithium chemical refinery plants in Jiangxi with a total capacity of 25,750 metric tons carbonate and 24,000 metric tons hydroxide in operation, with 20,000 metric tons of capacity under construction and 50,000 metric tons planned capacity.

Before this deal, BloombergNEF ranked Ganfeng as the second largest hydroxide producer, after Albemarle. Adding the capacity leased from Jiangte, Ganfeng will become the largest lithium hydroxide producer globally this year."