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 June 10, 2014
What will Tesla Motors' battery super plant mean for Critical Mineral demand?
    Publisher: Industrial Minerals Data


In February of this year, Tesla's announced its ambition is to build the world's largest electric vehicle battery production facility at a cost of $5B, known as the Gigafactory - the equivalent of today's global battery production in one plant. The expected demand for critical metals for the batteries, including cobalt, lithium and graphite, is substantial. It is estimated the global demand for cobalt alone from the Tesla Gigafactory will increase by 20%.

Tesla's CEO has stated publicly that the Gigafactory intends to ethically source its raw materials as locally as possible to reduce its carbon footprint. The front runner for the plant's location is rumoured to be near Reno, Nevada -- a relative stone's throw from Formation Metals' fully permitted Idaho Cobalt Project, a near term cobalt mine that could be in production in as little as 12-14 months upon the successful completion of mine financing.


This free report is made available from Industrial Mineral Data with permission. The report covers a wide range of topics related to this ambitious project, including Tesla's demand for the critical minerals it will require.
 June 05, 2014
ENRC to halt production of cobalt oxide concentrates in 2015
    Publisher: MetalBulletin
    Author: Fleur Ritzema


ENRC to halt production of cobalt oxide concentrates in 2015

Kazakhstan-based miner ENRC will halt production of cobalt oxide concentrates at its DRC Boss Mining operation from the start of 2015, Metal Bulletin understands.

The company will not expand its DRC mine when oxide concentrate resources are depleted next year, owing to low market prices, according to sources familiar with the situation.

Low-grade cobalt metal prices, on which concentrate sales are typically based, have dropped from close to $20 per lb in 2010 to the low teens in 2014.

Cobalt prices have stabilised over the past few weeks at $13.25-14.10 on low-grade.

The news about ENRC will come as a blow to Chinese cobalt salt makers, who have been struggling to source raw material at a time of tough competition on end products.

Oxide concentrates are widely used in China, where they are leached and used to make cobalt salts.

Most Chinese cobalt salt makers source the majority of their feed from three DRC-based suppliers: ENRC, Freeport Cobalt and Glencore.

ENRC exports around 4,000 tpy of cobalt contained in oxide concentrates to China, sources estimate.

ENRC will continue to produce sulphide concentrates at Boss Mining.

These sulphide concentrates are used as feed for cobalt and copper metal at ENRC's Chambishi operation in Zambia, Metal Bulletin understands.

Some cobalt hydroxide produced at the Tenke operation in the DRC used to be sold to Chambishi, Metal Bulletin understands. More of this hydroxide is now going to Kokkola in Finland, however, after its sale to Freeport Cobalt last year.

Chambishi cobalt is now solely reliant on sulphide feed from Boss Mining, Metal Bulletin understands.

Sulphide concentrates cannot be treated at most Chinese operations, owing to a lack of roasting facilities, Metal Bulletin understands.

ENRC had not responded to requests for comment at the time of writing.

To read more, Sign up for a Free Trial Metal Bulletin Membership

 May 25, 2014
Tesla's Gigafactory: Needs 6 new graphite mines, but where will cobalt be sourced?
    Author: Simon Moores - Industrial Minerals


Tesla's Gigafactory: Needs 6 new graphite mines, but where will cobalt be sourced?

The graphite, lithium and cobalt industries are set for major demand surges as Tesla Motors prepares to break ground on its super-battery plant, the Gigafactory, next month.

The high-end EV manufacturer is looking to double the world's battery output as it seeks to bring the production cost of battery packs down in a bid to spark mass EV uptake.

The company is aiming to begin construction on the Gigafactory in June 2014 with an old airfield in Reno, Nevada rumoured to be the favoured site.

One of the biggest impacts of the Gigafactory will be demand for the critical minerals that will fuel it.

Lithium, graphite and cobalt are all set to be key raw materials to make Tesla's lithium-ion batteries, but the question remains whether the company can get the volumes and consistent quality it needs in time.

Below is an analysis on the potential volumes of critical minerals Tesla would need for a Gigafactory operating at capacity which is expected in 2020.

Graphite demand up 152%

Graphite will be the largest input raw material for Tesla. Should the company choose natural graphite, it would require as much as 126,000 tonnes of flake graphite each year in the form of 50,000 tonnes of the battery-grade material, spherical graphite.

This is an increase of 152% on today's battery demand for the mineral. It equates to six new graphite mines on the basis of today's 30,000 tpa mine size average and the yield of suitable material gained from the mine.

Graphite both natural and synthetic is used as the cathode in a battery.

China is the leading producer of flake graphite and the leading processor of battery grade spherical graphite today. But the country is aiming to consolidate operations which could see it withdraw somewhat from the international market place.

Lithium demand up 50%

Lithium, the second largest input mineral by volume, will see demand increase by 25,000 tonnes a year from a Gigafactory at capacity. This is an increase in demand from the battery sector of 50% on 2013 levels.

Mined as a mineral and processed into a chemical, lithium is used as the cathode material in both hydroxide and carbonate form.

Chile is the leading producer of battery grade lithium today.

Cobalt demand up 17%

Cobalt demand from the battery sector could rise as much as 17% on 2013 levels thanks to Tesla's plans. This is the equivalent of 7,000 tonnes a year.

The metal is also used as a cathode material in lithium-ion batteries.

The leading supplier of cobalt is the war-torn country, the DR Congo in Africa which supplies 55% of the world's total.

Tesla has stated it does not get its cobalt from the Congo, however of most concern will be the lack of dedicated cobalt mines around the world with most supply coming as a by-product such as is the case of copper mining in Africa.

It is also important to note besides the Congo, there is no large producer of cobalt but rather many countries producing very small amounts varying from 3-7,000 tpa which collectively equate to the remaining 45%.

Other less critical raw materials Tesla will need include nickel, bauxite (aluminum), and copper. The company will not be using rare earths as its cars do not use a permanent magnet.

Please click here to read the full article.

 May 13, 2014
Cobalt Is the Key to Future Chips, Applied Material Says
    Publisher: Wall Street Journal - Digits Tech News & Analysis from the WSJ
    Author: Don Clark


Cobalt Is the Key to Future Chips, Applied Material Says

Few things get semiconductor experts more excited than a shift in the key materials used to make computer chips. Applied Materials (AMAT:NASDAQ) is proposing just such a change.

The Silicon Valley company, one of the best-known makers of semiconductor manufacturing machines, on Tuesday is announcing a way to head off defects that are becoming a stumbling block as manufacturers keep shrinking the size of transistors that act as tiny switches on chips. Applied plans to substitute the element cobalt to wall off the microscopic copper wires that connect the transistors together, replacing a material called tantalum.

"This is the first material breakthrough in the last 15 years in interconnect technology," says Sundar Ramamurthy, Applied's vice president and general manager of metal deposition products.

Applied's announcement follows a series of other changes spawned from the race to make smaller transistors, a pattern called Moore's Law that keeps driving down the cost of electronic functions. Intel (INTC:NASDAQ), for example, led a push to introduce the metal hafnium and three-dimensional structures into transistors to make them switch faster and use less energy.

As transistors get smaller, many more of them can be packed onto each chip--billions, in fact. Connecting them requires grids of wiring that are increasingly large and complex; the copper strands contained in all the chips fabricated on a typical 12-inch semiconductor wafer can measure 100 kilometers, Ramamurthy says.

But engineers run into problems as they shrink the size of those wires, which are formed by filling up furrow-like channels with copper. Like a large volume of water forced into a smaller streambed, current moves faster and causes impacts akin to the rocks or boulders moved by a rushing torrent, Ramamurthy says. The current can shake loose copper atoms, creating gaps called voids that lead to short circuits that cause chips to stop working correctly, he says.

The trick is to coat the sides of the copper-filled trenches with a thin film of cobalt instead of tantalum, as well as capping the channel with another cobalt layer, Ramamurthy says.

Encapsulating the interconnections with cobalt can bring an 80-fold increase in the electrical reliability of chips, Applied says.

There's another potential upside. Tantalum is what the industry calls a "conflict" metal, produced in parts of Africa where warlords sometimes control mining activity. Cobalt is available elsewhere.

Customers who want to make the shift will have to buy an Applied production machine to apply the cobalt, using a process called chemical vapor deposition. The company on Tuesday is introducing such a machine, an extension to an existing product line called the Endura Volta.

Ramamurthy says 75 of the CVD chambers for processing individual wafers are already in customer hands for testing purposes. The machines aren't likely to be introduced in large volumes until manufacturers are ready for their next process change to create smaller transistors.

After all, a switch in materials this basic doesn't happen often. "This is a big change," Ramamurthy said.

To read more or subscribe for the latest news and analysis follow on Twitter @WSJD,or subscribe your email address for the latest breaking news and reviews from WSJ personal-tech team

 April 22, 2014
China's cobalt concentrate imports up 13.3% in March
    Publisher: Metalbulletin


China's cobalt concentrate imports up 13.3% in March

China's cobalt concentrate imports rose by 13.3% year-on-year in March, according to the latest customs data.

Shipments last month were 11,555 tonnes, compared with 8,339 tonnes in February. The volume was within the normal range, market participant said, adding that cobalt concentrate imports...

To read more, Sign up for a Free Trial Metal Bulletin Membership

 April 14, 2014
Spotlight on cobalt: Juniors (T.FT) (V.GCO) (T.FCO) expect battery cathode output to drive demand
    Author: Editorial


Stockhouse Editorial - April 9, 2014, 2014

Spotlight on cobalt: Juniors (T.FT) (V.GCO) (T.FCO) expect battery cathode output to drive demand

Cobalt is a commodity that usually flies under investor radar screens.

But a number of developments are combining to put the spotlight on cobalt and companies that are aiming to produce the metal, including Fortune Minerals Ltd. (TSX: T.FT, Stock Forum), Global Cobalt Corp. (TSX: V.GCO, Stock Forum) and Formation Metals Inc. (TSX: T.FCO, Stock Forum).

The biggest one appears to be the recent announcement by Tesla Motors Inc. (NASDAQ: TSLA, Stock Forum) that it plans to open the world's largest battery factory in 2017, a move that is expected to increase demand for necessary raw materials, including graphite and cobalt.

While a site in the western U.S. has yet to be selected for the proposed Gigafactory, published reports say the factory is expected to produce enough rechargeable lithium-ion batteries each year by 2020 to power 500,000 Tesla electric vehicles.

Cobalt industry officials are welcoming the news that Tesla plans to source all the raw material for its proposed $5 billion U.S. battery factory in North America.

Cobalt is a critical component of super alloys and rechargeable batteries for uses ranging from mobile phones, laptops, and tablets, to hybrid vehicles and electric vehicles.

Demand for cobalt should increase by as much as 4,000-5,000 tonnes if the Gigafactory comes to fuition, wrote analyst Chris Berry, in an April 2, 2014 edition of Morning Notes, a newsletter that focuses on geolpolitical, technological and economic trends.

However, cobalt is usually mined as a by-product of other metals including nickel and copper.

"So it doesn't gain the attention in the market that a lot of commodities do,'' said Mitchell Smith, head of corporate development with Global Cobalt, a Canadian company which is working to develop the Karakul Cobalt project in Russia's southern Siberia region.

Smith said cobalt tends to be overshadowed by other metals because of the lack of primary cobalt producers that are available for people to invest in.

An exception is Global Cobalt, which has a deal with Beijing Easpring Material Technology Ltd., a supplier of battery grade material to Panasonic, Tesla's partner. Subject to the approval of Global Cobalt, Easpring will arrange offtake agreements with a major Chinese processor.

Also, Formation Metals has a fully permitted cobalt project near Salmon, Idaho, comprised of a mine and mill. Future production is estimated to be 1,500 tonnes of cobalt annually.

By contrast, Sherritt International Corp. (TSX: T.S, Stock Forum) is gearing up to produce 5,600 tonnes of finished cobalt annually from its Ambatovy mine on the eastern coast of Africa. But that material will be produced along with an estimated 60,000 tonnes of finished nickel.

Meanwhile, a report by FastMarkets' and posted on the website of Formation Metals says cobalt production has exceeded demand in recent years, creating oversupply and putting pressure on prices, according to the United States Geological Society (USGS).

No change is anticipated in this pattern, USGS said in its latest update.

"This trend is expected to continue in the near-term as production from new projects and expansions to existing operations add to supply,'' it added.

World mine production last year rose to 120,000 tonnes from 2012's 103,000 tonnes, the USGS estimated.

China was the world's leading producer of refined cobalt -- much of its production is from cobalt-rich ore and partially refined cobalt imported from Kinshasa in the Congo, where it owns facilities.

Congolese mine production last year was 57,000 tonnes, up from 2012's 51,000 tonnes. Chinese production from internal mines was 7,100 tonnes, rising from 7,000 tonnes.

Canadian production also rose to 8,000 tonnes from 6,630 tonnes, while there was an increase in Australian production to 6,500 tonnes from 5,800 tonnes.

Russian production was up at 6,700 tonnes from 6,300 tonnes, while there was a rise in Zambian output to 5,200 tonnes from 4,200 tonnes, the USGS added.

Jack Bedder, a senior analyst with Roskill, a London, England-based metals research firm, recently said global consumption of cobalt increased at a compounded annual growth rate of 5.5% between 2008 and 2013. Roskill also said it expects future demand to grow at a similar rate, expected to be 6.1% annually to 2018.

As a result, cobalt demand will reach over 100,000 tonnes.

Roskill went on to say that demand for cobalt will be led by Asia, particularly China, South Korea and Japan.

"Growth in demand in these countries will be driven by increasing battery cathode production,'' it said, adding that demand for cobalt in battery applications is forecast to grow at 9.2% per year to 2018 and will continue to be the greatest contributor to increased demand.

Meanwhile, in late February, cobalt prices hit a two-year high on strong demand for batteries at a time of low producer supplies, according to a report by Metal Bulletin.

However, Metal Bulletin also said low grade cobalt prices dropped to $14-$14.90 per pound April 9, 2014, down from $14.10 to $15 per pound previously. High-grade cobalt prices fell to $14.10 to $15.10 per pound, down from $14.20 to $15.30 per pound.

Both traders and producers expressed an eagerness to sell, having watched prices stabilize for several weeks following the recent rally,'' MetalBulletin said.

Stockhouse Disclosure: Global Cobalt is a Stockhouse client

 April 11, 2014
China's cobalt prices rise on tight supply, stronger demand
    Publisher: Metal Bulletin


China's cobalt prices rise on tight supply, stronger demand

China's cobalt metal prices have risen and are likely to rise further, according to market sources, amid recovering demand and tight supply.

On Friday April 11, cobalt metal rose to 199,000-208,000 yuan ($32,261-33,720) per tonne, compared with 198,000-208,000 yuan per tonne last Friday. Some market participants have reported stronger sales in recent weeks. "So far this month, our sales volume has increased by about 30% on the previous month. It seems the market is entering the busy season," a major smelter said. Another smelter agreed. "Major clients didn't...

To read more, Sign up for a Free Trial Metal Bulletin Membership

 April 09, 2014
DRC Seeking to Raise Cobalt Export Tax to 4 Percent
    Publisher: Resource Investing News
    Author: Charlotte McLeod


DRC Seeking to Raise Cobalt Export Tax to 4 Percent

Reuters reported yesterday that the Democratic Republic of the Congo (DRC) is looking to double its cobalt export royalty from 2 to 4 percent.

Some, such as Pieter Deboutte, who manages the company that holds Israeli billionaire Dan Gertler's mining and oil interests in the country, believe the move could make companies less eager to do business in the DRC.

As quoted in the market news:

Notes from talks with mining investors, seen by Reuters, show Congo is seeking to raise royalties on copper and cobalt from 2 to 4 percent, and gold from 2.5 to 3.5 percent.

The government is keen to tap new revenue streams, partly to help pay for elections in 2016 when President Joseph Kabila is scheduled to step down. Deboutte, however, said the government should be patient as tax revenues were poised to jump in any case over the next three years due to rising production.

Click here to read the full Reuters report.

 April 09, 2014
Strong competition for consumer sales drives cobalt prices lower
    Publisher: Metal Bulletin


Strong competition for consumer sales drives cobalt prices lower

Cobalt prices dipped this week, after competition for consumer business heated up.

Low-grade cobalt prices dropped to $14-14.90 per lb on Wednesday April 9, down from $14.10-15 per lb previously. High-grade cobalt prices fell to $14.10-15.10 per lb, down from $14.20-15.30 per lb. Both traders and producers expressed an eagerness to sell, having watched prices stabilise for several weeks following the recent rally. One producer reported reducing his...

To read more, Sign up for a Free Trial Metal Bulletin Membership

 April 07, 2014
Prepare to Be Electrified
    Publisher: Vancouver Sun
    Author: Paul Kariya and Merran Smith


Prepare to be Electrified

Zero-emission cars will soon be a much more common sight on our streets

By Paul Kariya and Merran Smith, Special to the Sun April 6, 2014

Starting in 2016, one in every 10 fleet vehicles bought by B.C. governments or companies should emit zero carbon pollution.

It's an internal combustion world out there. Spotting a zero-emission electric vehicle --- a Nissan Leaf, say, or a sparkling Tesla Model S --- on the streets of Vancouver remains something of a cheap thrill, at least for some of us.

But that's about to change.

Thanks to the Pacific Coast Action Plan --- inked last fall by British Columbia and the states of Washington, Oregon, and California --- starting two years from now, one in every 10 fleet vehicles purchased by British Columbia governments or companies should emit no carbon pollution whatsoever.

That's a remarkable commitment: Going off ICBC data and some simple assumptions, that adds up to about 3,000 new zero-emissions vehicles on the road in the province each year from the likes of Budget and Hertz, car2go, Canada Post, FortisBC, Modo (the Vancouver-based car-sharing co-op), municipal vehicles, universities, and others. Though the "zero-emissions" requirement is broad enough to include vehicles that run on fuel cells and biofuels, in reality the majority of the fleet vehicles meeting the requirement will be battery-electric.

Fortunately, several public and private fleets already have a jump-start.

Canada Post has run a fleet of electric mail trucks in Vancouver for several years. And every new light-duty vehicle purchased by the City of Vancouver runs on batteries unless there is a technical requirement for a different sort of vehicle due to size, range, or operational requirements. In fact, the City of Vancouver already meets and beats the 2016 requirement; last year, 16 per cent of the city's new vehicle purchases were electrics.

Others can follow the City of Vancouver's lead. In a recent study, Ontario consulting firm FleetCarma concluded that more than 90 per cent of our province's existing fleet routes could be covered with electric vehicles. The Action Plan commitment will help reduce pollution in British Columbia --- since B.C.'s electricity is overwhelmingly clean and renewable --- but it will also play a critical role in accelerating the adoption of electric vehicles.

That's because fleets offer people an opportunity they would not otherwise have to drive and ride in EVs. That familiarity is sorely needed --- despite the success of the provincial government's policies to support EVs, such as rebates for vehicles and charging stations as part of the clean vehicle program.

There are now plenty of places to plug in, and plenty of people doing so --- more than 600 charging stations dot B.C. roads and parking lots, and dealers sold more than 500 EVs last year. Still, according to recent WWF Canada research, only eight per cent of West Coasters have ever seen or ridden in an electric vehicle.

This will change quickly as the action plan commitment starts to kick in. It's already well underway in London, England, on a bigger scale. By 2018, every new taxi in the city will be a zero-emission vehicle --- again, mostly electric.

B.C.'s action plan commitment will doubtless inject fresh energy into our province's small but vital low-carbon transportation sector, which currently employs about 1,500 people and contributes $110 million to the economy. The sector is developing batteries and power systems for current and future vehicles, while figuring out how to best integrate electric vehicles with our mostly clean energy grid.

Their solutions to these challenges will offer lessons to the rest of the world.

Energy systems around the planet are changing rapidly, and B.C. needs to remain competitive to stay in the game. According to research firm IHS Automotive, worldwide sales of electric vehicles grew by 44 per cent between 2012 and 2013, and the market is expected to increase by an additional 67 per cent by 2014 --- or just shy of half a million vehicles. Navigant Research forecasts six million electric vehicles will be plying planet Earth by 2022.

In sum, zero-emission vehicles are here to stay, and B.C.'s Action Plan commitment will help ensure this sector remains competitive.

Not that it will be easy. The provincial government is not planning to continue its rebate program and the zero-emission fleet commitment is non-binding. In addition, opinions differ how to achieve the commitment. Should rebates be reinstated? Should the province legislate its zero-emissions fleet requirement?

We look forward to working with the province and the other companies and organizations to wrestle these questions down to earth and advance electric mobility in B.C. --- for cleaner air, a stable climate, and a prosperous and diverse economy.

Paul Kariya and Merran Smith are members of The Energy Forum (, an industry-NGO collaboration promoting better climate, energy and environmental policy and practices in the clean energy sector.

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