@brunk, I
agree about the upside demand for lithium but arrive at that view even if the oil price doesn't go up as you predict. Sure,
if the oil price goes up then people will chose more electric vehicles, and thus Li-ion batteries.
However even if the oil price doesn't increase - and perhaps even if it falls - Li-ion battery
demand will increase - because of the increasing uptake of solar energy. Huge inroads are being made with solar energy generation, as the efficiency of panels rises at the same time as their price falls. This is
not just an environmental point; it's becoming good business for economic reasons.
Solar is becoming so cheap in some places to generate that
it's becoming irresistible to capture and store the energy for later use. That's driving very strong demand for batteries, especially Li-ion. Check out this
superb presentation by the highly regarded Tony Seba on this topic. It's long but he's a really entertaining speaker. I guarantee you'll love watching it:
This
battery storage theme rings true at a personal level. Energy suppliers have been screwing Australian householders for years with excessive power charges. Even as the oil price fell from levels often over US$100/bbl for WTI in the period 2010-2013ish to below $30 in 2015, our power charges kept rising! Householders like me have become angry, and have installed solar power and are now just waiting for battery storage costs to drop some more before putting in big storage systems so we can substantially use our own solar-generated power. (One of my neighbours has a Tesla Powerwall and another one plans to get his by Christmas).
Importantly,
lithium technology is assured in mainstream battery production for many, many years even if there were to be technology changes in future. Indeed, current trends are suggesting
some future batteries that will store and use even more lithium. Check out this:
http://www.mccormick.northwestern.e...hium-rich-battery-could-last-much-longer.html
In summary, given:
- legislated environmental change, world-wide, towards electric vehicles;
- favourable technology winds (whether oil goes up or down);
- the rare opportunity for countries like China to gain huge penetration of the previously hard for them to penetrate vehicles market - which will incentivise them to aggressively pursue new, disruptive electric vehicle technology; plus
- Lake's superb acreage position - 100% owned, massive (~170,000 hectares) and diverse (brine targets at multiple locations, plus extensive pegmatites),
the
future looks very bright for LKE, irrespective of day to day market sentiment. We now have enough $ in the bank to really get after our projects.
