High Voltage: All the news driving battery metals stocks
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Welcome to 2019! Each week our High Voltage column wraps all the news driving ASX battery metals stocks with exposure to lithium, cobalt, graphite, manganese and vanadium.
Scroll down for a table showing the recent performance of 200 ASX battery metal stocks >>
It was a clear, unequivocal message on the robust outlook for electric vehicles: customers of lithium major Pilbara Minerals (ASX:PLS) are not only financing its next project expansion but are already pressuring the producer for additional output.
Pilbara Minerals told investors the Stage 2 funding package, underpinned by key customers Ganfeng Lithium and Great Wall Motor Company, will see production at its Western Australian Pilgangoora lithium-tantalum project ramp up to 5 million tonnes a year.
These customers are rapidly scaling up their respective supply chains, prompting Pilbara Minerals to target commissioning of Stage 2 from the March quarter 2020 as well as kicking off studies on Stage 3.
“They have made it clear that they would like to see the project grow further, prompting us to undertake studies to evaluate a potential Stage 3 expansion to at least 6.2mtpa and potentially up to 7.5mtpa,” Pilbara Minerals boss Ken Brinsden said.
“This should send a clear message about the robust outlook for the lithium market as far as our Tier-1 customer base is concerned and demonstrates the secure position the world-class Pilgangoora project commands as part of a global lithium-ion supply chain that is growing rapidly.”
On January 2 lithium behemoth Albemarle Corporation (NYSE:ALB) kicked off earthworks for the company’s $1 billion, 60,000 tonnes per annum Kemerton lithium hydroxide (LiOH) plant in Western Australia.
“Achieving this milestone underscores our commitment and confidence in developing LiOH operations in Western Australia and in our overall strategy to drive significant shareholder value and meet our customers’ demands,” Ablemarle told investors.
The commissioning of the Kemerton site is expected to start in stages during 2021.
Lithium producer Galaxy Resources (ASX:GXY) is getting swamped with offers from potential strategic partners wanting a piece of its Argentina-based Sal de Vida brine project.
Galaxy is debt free and making good coin from its Mt Cattlin operation in Western Australia, which means it is quite happy to extend the process timeline to evaluate the bids in detail.
“Given the superior quality of Sal de Vida as a long life, low-cost operation with excellent economics, Galaxy will only proceed with a strategic partner if the final terms of the relationship properly recognize the fundamental underlying value of Sal de Vida and the partner can add additional value to the project either through technical and/or financial input,” the miner told investors.
SMALL CAP SPOTLIGHT
It was a sleepy (but half decent) start to the year for battery metals-facing stocks on the ASX; of the companies on our list, about 68 lost ground, 80 were ahead and 40 were steady.
A friendly takeover offer from global battery metals investor Cobalt 27 has sent the share price of nickel and cobalt miner Highland Pacific up almost 37 per cent for the week.
Highlands Pacific (ASX:HIG) told investors that TSX-listed Cobalt 27 would buy the rest of Highlands that it didn’t already own for 10.5c per share – a 43.8 per cent premium to the December 24 closing price of 7.3c.
And there’s a bonus: the offer will increase to 11.5c if the nickel spot price exceeds $US13,220 per tonne for five consecutive days before the end of 2019.
It has a way to go though, with the LME spot price for nickel currently at $US10,590 per tonne.
— Stockhead (@StockheadAU) January 7, 2019
Cobalt hopeful Celsius Resources (ASX:CLA) is also up 22.5 per cent for the week.
The explorer told investors that a different and “potentially highly significant” type of cobalt and copper mineralisation at its advanced Namibian project could give it bonus options for mine development.
Celsius uncovered the extension to the existing resource at its Opuwo project in the latest round of drilling.
“The new area announced today is much flatter, (near horizontal) which opens up the possibility of using an alternative underground method such as room and pillar mining, which would be expected to provide significant cost advantages, compared to the open stoping method,” Celsius boss Brendan Borg told Stockhead.
Other standout performers included cobalt/copper focused Taruga Minerals (ASX:TAR) up 27.5 per cent to 6c, and graphite plays Renascor Resources (ASX:RNU) and Peninsula Mines (ASX:PSM) ,up 35 per cent and 33 per cent respectively.
Here’s a table of ASX battery metal stocks with exposure to lithium, cobalt, graphite, manganese and vanadium>>>
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