High Voltage: Does lithium need its own ‘Supermajor’?

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Pilbara lithium miner Altura has gone into administration, the latest victim of a spodumene price that has plunged about 60 per cent from its July 2018 peak.

Neighbouring producer Pilbara Minerals was quick off the mark with a $US175m ($247m) takeover bid but, at that price, it could have some competition.

RK Equity founder Howard Klein says  a ‘New Force in Lithium’ could emerge from the ashes of this bear market.

“(Could) WA spodumene – the Pilbara in particular – consolidate like iron ore; and thereby to provide sufficient power for remaining SC6 [spodumene] suppliers to make a decent living – and, at times – a killing?

“I have no doubt this is on Pilbara’s (ASX:PLS) mind.”

Producers that act now will like to see themselves the dominant force for the next lithium growth cycle, Benchmark Mineral Intelligence says.

“The reality is that lithium will experience double digit growth short term, and the long-term picture has significantly strengthened,” it says.

“Pilbara’s nameplate Stage 1 capacity is 330,000tpa (tonnes per year), while Altura’s Stage 1 capacity is 220,000tpa of spodumene concentrate, enabling Pilbara to significantly expand its capacity at the bottom of the lithium market.”

But consolidation might not be enough. Lithium could need its own supermajor, Benchmark says.

While Rio Tinto is dipping its toes, no major miner has yet made a serious play in lithium.

“Considering the time it takes to build new lithium mines and ramp up to meaningful chemical capacity — which by mid-2020s will be anything larger than 50,000 tpa LCE (lithium carbonate equivalent) — the industry will need to shift the way it thinks and the way operates,” Benchmark says.

“Bigger fish will need to enter lithium.”

Here’s how a basket of 105 ASX stocks with exposure to lithium, cobalt, graphite, nickel, and vanadium are performing>>>

Scroll or swipe to reveal table. Click headings to sort.

Unlike lithium, nickel sentiment is flying.

Stockhead’s battery metals weekly top 10 is, once again, dominated by nickel sulphhide plays like Auroch, Estrella, St George, and Chalice.

Auroch Minerals (ASX:AOU) is a certified bolter. The WA explorer is now up ~180 per cent over the past month as it dials in on WA’s next big nickel discovery.

The recent benchmark is Estrella Resources (ASX:ESR), which has soared ~1200 per cent since making a spectacular nickel discovery at the Carr Boyd project in early October.

Meanwhile,  St George Mining (ASX:SGQ) says a discovery is “imminent” after identifying two very strong conductors at the Mt Alexander project in WA.

Down-hole electromagnetic (DHEM) surveying involves sending a probe attached to a wire cable down a completed drill-hole.

The probe is then able to “see” conductive mineralisation up to 75m away.

Every conductor in the Cathedrals Belt has turned out to be massive sulphides with high grades of nickel, copper, cobalt and PGEs.

A 100 per cent hit rate.

“The MAD184 conductors are particularly exciting as they are the deepest conductors ever identified in the Cathedrals Belt and located 800m to the west of previously intersected massive sulphides on the Cathedrals Belt,” St George exec John Prineas says.

“With a 100 per cent success rate in testing these kinds of conductors in the Cathedrals Belt, we are confident that our next significant discovery of massive nickel-copper sulphides is imminent.”

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