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While 2020 has been challenging for many sectors, battery metals has proven to be incredibly resilient thanks to a growing shift towards electric vehicles and renewable energy.
The growing use of nickel in batteries – with maverick electric car manufacturer Tesla’s boss Elon Musk famously calling on nickel miners to increase production – has also benefitted companies that count the industrial metal in their portfolios.
This is certainly the case for Chalice Mining (ASX:CHN) – formerly the somewhat misnamed Chalice Gold Mines, which leads our list of top 50 battery metals companies (to 14 December) with a 2,140 per cent return over the past year.
It owes this remarkable performance to its exciting Julimar high-grade nickel-copper-palladium discovery just 60km from Perth where the maiden intercept returned 19m at 2.59 per cent nickel, 1.04 per cent copper, 8.37 grams per tonne (g/t) palladium and 1.11g/t platinum.
Since then it has continued to intersect thick, high-grade intersections of mineralisation that highlight the significance of Julimar.
Predictably, Chalice’s success has sparked a bit of a land grab with companies rushing to grab ground near or within the same geological terrane as Julimar.
Top 50 battery companies in 2020 (to December 14)
Here are the top battery metals articles on Stockhead this year
Turns out that everybody is keen to know where the next stock winner will come from.
In our September article, we examined a number of battery metal and gold companies with market caps of less than $5m that held promise.
These included companies such as Blackearth Minerals (ASX:BEM), which continues to progress the Mainry graphite project in Madagascar towards development, and QEM with its Julia Creek vanadium-oil shale project in Queensland.
Fun fact. They aren’t multi-baggers. Yet.
This should come as little surprise to readers, but readers eagerly consumed our coverage on Tesla’s Battery Day in September.
“In order to scale [production], we need to ensure we are not constrained by total nickel availability,” Elon Musk told attendees at the event before saying that he had called on the largest nickel producers to increase output.
While iron-based batteries will still be used where energy density is not paramount, the American electric car manufacturer is turning to a nickel-manganese chemistry for medium-life batteries and a high-nickel option for long-range vehicles.
Despite this, it still seeks to build an affordable mass market car with a sales tag of around $US25,000 ($35,000) according to reports.
Probably a good thing for Australian EV enthusiasts given how several Australian jurisdictions seem keen to discourage EV adoption.
Surprised that it’s more about Elon? We’re not.
When you have one of the world’s most famous mavericks spruiking batteries, it sparks interest in battery metals. However briefly.
Consultancy Wood Mackenzie added that not only was bringing new battery metal supply to market one of the biggest barriers to rapid EV adoption, Tesla’s plans would mean that it would only be after 2023 before we can really see cheap EVs.
The chaos brought about the COVID-19 pandemic has made Europe especially interested in securing its battery supply chains.
Germany, France and Poland have all announced big investments into their respective batteries industries while the European Union has also sunk money into battery research.
This interest also benefits ASX companies with battery metal operations both within and near Europe.
Woodmac believes China will need to spend over $7 trillion to achieve its goal of carbon neutrality by 2060 and that is good news for battery metal companies.
And the world’s most populous country will need that big spend to increase its solar, wind and battery storage capacities by 11 times to replace fossil fuels, which currently make up 90 per cent of its energy mix.
Its road transport will also need to be fully electrified, which will in turn require many more EVs and the batteries that power them.
All this will need staggering amounts of battery metals like lithium, graphite, cobalt, nickel, copper, and manganese.
And that’s music to the ears of certain company bosses.
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