Here is an excellent article discussing how BHP are looking to position itself in the electric car market.
AUZ have 3x mines, with scone showing at least 20+ year mine life, plus the Thacka and Flemington (who knows the potential mine life).
BHP have a Strong balance sheet, excellent cash-flow with AUZ minimal sov risk.
If i were BB i'd be looking at this opportunity and conversely if i were BHP i'd consider this asset to add to it's current asset classes of coal, copper, iron-ore in Australia.
***All this is in my opinion of course (we can all dream can't we)?***
"revealing plans to transform itself into the world’s biggest suppliers of nickel sulphate"
“We believe there is going to be a very large increase in nickel sulphate demand over the midterm, in order to support this new energy revolution.”
For more than a century, Western Australia has yielded a lucrative bounty for gold and iron ore miners. Now, a battery revolution driven by the transition to electric vehicles and energy storage systems is creating a rush to exploit its reserves of lithium, cobalt and nickel. On Wednesday BHP Billiton joined the party, revealing plans to transform itself into the world’s biggest suppliers of nickel sulphate — a key component in lithium-ion batteries that power electric cars. BHP is spending $43m on a new facility to produce 100,000 tonnes of sulphate per year and aims to start output by April 2019. “This is a massive change,” Eduard Haegel, BHP Nickel West president, told the FT on the sidelines of the Diggers & Dealers mining conference in Kalgoorlie, Western Australia. “We believe there is going to be a very large increase in nickel sulphate demand over the midterm, in order to support this new energy revolution.” BHP is betting the industry is moving to nickel rich batteries, which are favoured by Tesla and Panasonic, and have a higher concentration of the metal than rival technology. Share this graphic It says the high-grade nickel it produces is well suited for use in lithium ion batteries and it will shift from selling most of its nickel into the low margin stainless steel market into the higher margin energy storage and electric vehicle market. Within five years, BHP expects to sell 90 per cent of its nickel into the battery market, compared with 10 per cent today. BHP has previously said that Nickel West, an integrated mining operation based in Kalgoorlie, is a noncore asset and has looked at selling the business. The plan to shift to sulphate production gives the unit a new lease of life. UBS is forecasting a twenty-fold increase in global electric vehicle sales to 15m units by 2025, which it says will boost demand for the raw materials used to build batteries, including lithium, cobalt, nickel and graphite. Western Australia is rich in these resources and a new generation of miners is targeting the market, attracting international partners to develop mines in the region. Last month the world’s biggest lithium company, Sociedad Química y Minera de Chile, paid $110m to take a 50 per cent stake in Kidman Resources’ Mt Holland lithium project in Western Australia. Share this graphic In June, Pilbara Minerals raised $100m to fund a $234m lithium mine, which it expects to come into production in 2018. It has negotiated offtake agreements with China’s General Lithium and Jiangxi Ganfeng Lithium covering the entire 300,000 tonnes of concentrate production. “Australia is already the biggest producer of lithium in the world,” says Chris Reed, managing director of Neometals, which owns a 13.8 per stake in the Mt Marion lithium mine near Kalgoorlie. “There are four lithium mines in production and four more in development,” he says. In 2016 Australia produced 14,300 tonnes of lithium, while the number two and three producers — Chile and Argentina — produced 12,000 tonnes and 5,700 tonnes respectively, according to the US Geological Survey. Australia’s production comes from hard rock deposits, while Chile and Argentina’s lithium comes from brine. While brine-extraction is slow, it is generally cheaper than hard rock operations, since the lithium is already isolated within the brine and the sun does much of the work. Global lithium consumption increased by 14 per cent to 37,800 tonnes last year, pushing prices for lithium carbonate — above $20,000 per tonne on China’s spot market. Ken Brinsden, managing director of Pilbara Minerals, is predicting a “material crunch” in supply and demand unless new investment begins flowing into lithium mining globally. He predicts either big car companies or battery producers will begin to invest in raw materials and says Australia is well placed to benefit from investment. “It’s a fantastic opportunity. There is almost no better place in the world to construct a mine than the Pilbara,” he said. Produced as a byproduct of copper and nickel, cobalt — another critical component in lithium ion batteries — is a target for miners with some analysts forecasting demand for the metal could surge. Glencore is the country’s biggest producer at its Murrin Murrin nickel mine and processing facility in Western Australia. But new entrants are chasing a cobalt price that has jumped 73 per cent this year on the London Metal Exchange. Ardea Resources, a small mining company based in Perth, is aiming to develop Australia’s largest cobalt deposit near Kalgoorlie — a resource formally owned by Brazilian group Vale. Another Australian company Cobalt Blue is targeting a project near Broken Hill in New South Wales. “You only have to look at the movement in the cobalt price over the past 12 months and see the number of explorers entering the space to gauge the excitement and opportunities available,” says Paul Howard, analyst at Hartleys, a Perth-based broker.
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