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What is Lithium Worth?

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The following content is sponsored by Benchmark Mineral Intelligence.

What is Lithium Worth?

What is Lithium Worth?

Different generations find different uses for raw materials, changing the value of these inputs over time.

Lithium is not a new discovery, but its applications are. Scientists first discovered lithium as an element in 1817, but it was not until the 1970s that studies into lithium-ion batteries began.

It was a British chemist working for Exxon that first proposed the idea of lithium-ion battery. However, after some initial testing, Exxon abandoned the project.

Nonetheless, lithium-ion battery technology has evolved into regular use through cell phones and electric vehicles. It offers an alternative to fossil fuels that global industry can run on.

Just as the world currently watches the prices of oil to determine the trade winds, lithium could become just as important for the worldwide movement to clean energy.

Pricing the New Oil

Traditionally, buyers and sellers have priced lithium through long-term contracts. However, in recent times, there has been a push from major end-users, especially automotive OEMs, to have more price transparency and to use third-party independent contract references in negotiations.

Benchmark Mineral Intelligence has created a standard for pricing the special lithium chemistry for the battery supply chain that the industry can rely on.

Supply & Demand: Miners, Manufacturers and End Users

Lithium is a hot commodity in the mining, manufacturing, energy storage, and automobile industries today. The current size of the market is small, but the potential is huge.

In 2016, the world’s leading lithium battery companies produced 29GWh of batteries. This production is forecast to grow to 1049GWh by 2028, an increase of 3516%.

Data Collection and Price Reporting

There are three cornerstone factors Benchmark uses to set the lithium industry’s reference price.

  1. Quality and grade of lithium
  2. Shipping costs and volumes
  3. Quality and reliability of information

Let’s look in deeper at each one:

1. Quality and Grade of Lithium

Most of the world’s lithium comes from two sources: mined from hard rock deposits of pegmatites, or pumped from lithium brine salars.

Grade and impurity of extracted lithium have unique profiles which will affect its price. Lithium is converted into different compounds: spodumene concentrate, lithium carbonate, and lithium hydroxide.

These different varieties suit manufacturers’ exact specifications with different cost profiles.

2. Shipping Costs and Volumes

The origin and destination of lithium is an important choke point for pricing information. At these locations, “incoterms” are set rules that represent the destination and origin of the material, which in turn affects the cost of lithium.

3. Quality and Reliability of Information

In order to generate a lithium price, Benchmark embarks on the industry’s most rigorous price data collection process that relies on constant contact through email, phone calls, and in-person meetings.

Benchmark analysts evaluate the information received against volumes traded, the position of a company in the market, and reliability of the source of information.

The Results

Independent and accurate prices will be key as the lithium market grows, providing a solid foundation for contract negotiations and a level of transparency that will help attract capital to the market.

The varying nature of lithium chemicals makes it difficult to manage risk, but Benchmark Mineral Intelligence is building a standard for pricing lithium to help manage this, and set us off on a new era of energy.

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On the Edge of Discovery: Canada’s Next Gold District

Canada is home to prolific mining regions, but there is still more to find. The Trans-Hudson Corridor could be Canada’s next major gold district.

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Trans-Hudson Corridor

On the Edge of Discovery: Canada’s Next Gold District

Canada is home to some of the greatest gold districts in mining history. These regions occur mostly across Ontario, Québec, and British Columbia, where past mineral exploration has uncovered their geological potential.

But Canada is vast, and there are still more regions to explore—in particular, the Trans-Hudson Corridor. It’s here that SKRR Exploration and Taiga Gold are leading the way into a new mineral frontier, with the hope of uncovering Canada’s next gold district.

Canada’s Major Gold Districts

The Abitibi Greenstone Gold Belt, the Red Lake Gold District, and the Golden Triangle are key sources of gold in Canada.

  1. Ontario and Québec’s Abitibi Greenstone Gold Belt:

    With over 100 mines, this gold belt stretches across the provinces of Ontario and Québec from Wawa to Val-d’Or. The belt has produced a massive 180M ounces of gold over its history and remains today a source of gold and employment in Northern Ontario.

  2. Ontario’s Red Lake Gold District:

    The Red Lake Gold District experienced its first gold rush following initial discoveries in 1897 and 1925. With over 30M ounces of gold produced since then, the Red Lake mining district is one of the largest and highest-grade gold camps in North America.

  3. British Columbia’s Golden Triangle:

    Having hosted the Stikine Gold Rush and the Atlin Gold Rush, the Golden Triangle is a popular destination for exploration companies. Investment in the region has produced 5.26M ounces of gold and impressive discoveries such as the Bruce Jack mine and the Kerr-Sulphurets-Mitchell (“KSM”) project.

Although these regions have garnered attention from large mining companies, the Trans-Hudson Corridor is open for a new era of discovery, and very few companies have taken advantage of it.

The Trans-Hudson Corridor: Canada’s Next Gold District?

The Trans-Hudson Corridor lacks an extensive exploration history, but it shows potential as a prime area for discovery.

Geological Potential

The Trans-Hudson Corridor stretches from the Dakotas of the United States to James Bay in Canada. One of the few remaining exposed portions of the Trans-Hudson, the Black Hills region of South Dakota, hosts the famous Homestake Mine, which produced 43.7 million ounces of gold and 9.9M ounces of silver before closing in 2001.

Despite the geological potential of this corridor, there have only been a few operating gold mines in the northern portion of the Trans-Hudson. One study indicates there may be more gold mineralization near the Snow Lake mine.

Saskatchewan: Major Gold Mines and a Lack of Exploration

Saskatchewan has geological potential—but compared to other regions, explorers are barely scratching the surface.

For all of Canada in 2018, mining and exploration investment amounted to C$2.2 billion. Saskatchewan received some of the lowest amounts with only C$165 million expended. Only 2% of the $165 million went towards exploration for gold, while the rest for uranium and potash.

Canada: Safe and Stable Mining Jurisdiction

The Trans-Hudson Corridor offers a safe, stable, and accessible mining region in today’s volatile world. In particular, Saskatchewan provides a competitive edge for mineral exploration:

  • Affordable access to North American capital markets
  • Mineral exploration incentive programs
  • Low-cost, high-quality road and power infrastructure
  • A well educated and professional workforce

Canada has the geological potential for big gold discoveries and the next era of discovery could be waiting in the Trans-Hudson Corridor.

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Unlocking Earth’s Treasures with Mineral Exploration

There are untold treasures in the Earth’s surface waiting for discovery. Skeena Resources is opening the vault in the Golden Triangle at Eskay Creek.

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Natural Wealth

Unlocking Earth’s Treasures with Mineral Exploration

There are untold treasures of gold, silver, copper, and much more that lie beneath the Earth’s surface, awaiting discovery—and it takes mineral exploration and the right team to unlock this hidden wealth from the depths.

Mining exploration company Skeena Resources is opening the vault to the treasures of British Columbia’s Golden Triangle at the famous Eskay Creek property.

Following in footsteps of other successful mineral exploration efforts, Skeena is proving there is more value to unlock at Eskay Creek. The Golden Triangle is already home to some of the most productive mines in the world.

Keys to the Vault: Turning Discoveries into Resources

A mineral exploration company such as Skeena conducts geological studies to turn a discovery into a mineable resource. As each mineral deposit becomes better understood, new value is unlocked and its economic value increases.

The mining industry uses three resource classifications for a mineral discovery, based on the amount and proximity of drill holes.

  1. Inferred
  2. Indicated
  3. Measured

Each one of these categories represent the confidence with which an economic source of minerals exists. The “Inferred” classification is the lowest level of confidence that a certain amount of ore exists in a location while “Measured” is the highest.

Companies drill holes and pull out small samples of the ground in order to discover and measure the continuity and grade of a mineral occurrence. The results of drilling provide more and more data for improving the understanding of a deposit. Each study eventually cuts the key to unlock the treasure below.

Grade is King: The Higher the Grade, The Lower the Costs

In order for a mineral deposit to be valuable it must pass the grade. The amount of the sought-after mineral within a particular amount of rock is known as the ore grade. Typically, the higher the ore grade, the more profitable a mine can be.

Skeena Resource’s Eskay Creek has a grade of 4.3 grams per tonne ‘g/t’, making it 3x higher than the global average grade of open pit mining projects. This could potentially make it all the more unique and valuable to investors.

Unlocking the Vault

Gold’s value is in part due to its rarity. The precious metal cannot be artificially produced and is only found deep inside the vault that is the Earth’s crust. This makes mineral exploration an extremely rewarding business if a discovery is made.

In terms of statistics, the odds are 1 in 10,000 that greenfield exploration produces a profitable mine—and odds are even more remote for a mineral occurrence to become a world-class mine. Further, if a gold deposit is actually found, there is only a 10% chance it will have enough gold justify further development.

Through targeted mineral exploration, Skeena Resources is proving there is more golden treasure to uncover at the legendary Eskay Creek.

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