The Lithium Gold Rush is Underway
Tesla is the Tip of the Iceberg
“Look, let's have a go.”
It's fast becoming just that easy to start a new lithium exploration project.
All over the world, lithium demand is skyrocketing.
In fact, demand is expected to keep climbing by about 8.8% every year through 2019.
And that's really just the beginning...
Now, given this new lithium gold rush, the biggest question on many investors' minds is, “How can I get the most bang for my buck?”
But you shouldn't be asking “how” so much as “where” the value lies...
Tried and True
The world's biggest reserves of our booming metal oil are found in Chile, China, and Argentina.
Of these, only one doesn't yet have a sizable lithium production process: China.
The other two, Chile and Argentina, are the world's major lithium hubs, where the Big Three in lithium production have ruled for years.
But that's changing right now.
As of last year, Australia is actually the highest producer of lithium in the world. The country has only the fourth-largest reserves but one of the biggest advantages in the lithium market:
Those reserves are all held in brines.
We've spoken before about the incredible differences between brine and hard-rock mining; it's simply easier and cheaper to get lithium from water than from rock.
And so Australia, with 13,400 metric tons of lithium produced in 2015, is one of the best places for new market entrants to make their mark.
Western Australia especially is seeing renewed interest, as companies new and old look to get in on the lithium gold rush. Companies like Mithril Resources and Neometals Ltd. are starting a number of new projects this year near Kalgoorlie.
This area is geologically similar to an already highly productive area called the Mt. Marion Project, but it has never been explored commercially before.
It simply wasn't worth it for a long time.
And now it's not worth losing out on the possible new supply.
North American Exposure
Of course, Australia isn't the only country seeing some new business.
Canada, oddly enough, is bringing in new lithium hopefuls as well.
Much like Kalgoorlie, several areas in Canada have always had the potential for lithium supply but have never been explored seriously.
Part of the reasoning behind this is that the Canadian deposits are more often rock than brine.
And while some argue that rock deposits, like spodumene, have higher concentrations of lithium than brine, it's simply more economical to work with water.
Another reason is that before now, there wasn't any reason to go looking for new supply. The Big Three had demand mostly covered.
But with demand far outstripping supply now — and expected to continue doing so — new projects keep cropping up.
And yet this still isn't the answer to our original question...
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The Silver State
No matter how you look at it, Nevada is the place to be to take advantage of the lithium revolution.
Once it was known for having an easy supply of silver, and now it's become known as the U.S. lithium hub.
Not only does it have the benefit of both hard-rock and brine reserves, allowing for companies with expertise in either production method to jump in, but it's also right next door to the company driving this revolution...
Are you tired of hearing that name? That's only because you haven't started making money on it... yet.
You see, Tesla is indeed just the tip of the iceberg here. But that just means it's leading the pack, and savvy investors will know to follow.
Of course, you can't just pick any stock and hope it grows. There's some due diligence to be done before you dive in headfirst.
And to help you out, dear reader, I've done that research for you. I've found one tiny stock that's already begun working in Nevada and is looking good to be one of the major suppliers for Tesla's Gigafactory.
You can read all about it right now, at no cost to you, right here.
Until next time,
A true insider in the energy markets, Keith is one of few financial reporters to have visited the Alberta oil sands. His research has helped thousands of investors capitalize from the rapidly changing face of energy. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital as well as Investment Director of Angel Publishing's Energy Investor. For years, Keith has been providing in-depth coverage of the Bakken, the Haynesville Shale, and the Marcellus natural gas formations — all ahead of the mainstream media. For more on Keith, go to his editor's page.
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