In the first few months of 2017, MGX Minerals, Inc. (OTC: MGXMF) announced a cheaper lithium extraction process (http://dtn.fm/5xqMc) that yielded 1600mg/L of lithium and also recovered potentially saleable by-products of magnesium, boron and potassium.
The market for lithium-ion batteries is expected to grow in value to $46.21 billion annually within the next five years thanks to growing demand from electric car manufacturers such as Tesla, Nissan and BAIC Motor.
Thanks to its unique characteristics, lithium provides the most energy per weight or volume, so batteries can be made smaller and more efficient. The demand is growing rapidly, and Deutsche Bank (NYSE: DB) and Macquarie Research predict growth rates between 60 and 250 percent in the next few years alone.
Electric cars and consumer products utilizing lithium-ion batteries are not the only reason for lithium’s explosive growth prospects. Renewable energy sources such as wind and solar are also becoming increasingly reliant on lithium-ion battery storage. Without the ability to store clean energy for on-demand delivery to the grid, renewable sources will remain unable to compete with fossil fuel sources.
The increasing demand suggests increased pressure on suppliers, who have been slow to respond with opening up new supply chains. According to a Bloomberg press release (http://dtn.fm/3GtkQ) that quoted the world’s largest lithium producer, Albemarle Corp. (NYSE: ALB), lithium carbonate prices spiked in China from $4,000 in 2014 to over $20,000 per metric ton in 2016.
A lithium mining boom is currently underway. Many companies exploring for lithium have set their sights on Clayton Valley, Nevada, which is home to the only lithium-producing mine in North America. Clayton Valley is attractive, because lithium can be extracted from brine aquifers, rather than high cost hard rock mining. The brine is evaporated in large settling ponds in a process that can take 18-24 months. The low grades at Clayton Valley are offset by large quantities and low costs of the evaporation technique.
MGX, however, has banked on decreasing the evaporation timeline to less than one day. Its patent-pending PetroLithium™ methodology separates valuable minerals from salt water (brine) that accompanies oil and gas production. Until now, petroleum brine has been discarded as a waste product, but MGX is working to develop technology that will extract lithium and other valuable minerals in less than one day while also cleaning the wastewater brine and making it safe for the environment.
In early March, MGX reported that it had concentrated 20 times more lithium than was concentrated through earlier extraction methods (http://dtn.fm/gY6tB), while contaminants were removed using less energy. The company has expanded its mining operations from Alberta into the Lisbon Valley oil and gas field located in the Paradox basin, near Moab, Utah. MGX has also signed an agreement to earn a 50 percent interest in the Paradox Basin Lithium Brine Property, thanks to a recently announce joint-venture with Scientific Metals Corp.
In total, MGX has built a lithium portfolio spanning over 175 million acres, or 2,400 square miles, throughout North America. At current prices, it’s estimated that there could be $18 billion worth of lithium to be mined. The pace appears to be picking up for MGX and lithium mining in general.
For more information, visit the company’s website at www.MGXMinerals.com
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