The rise of ECM is about to begin with the finalisation of the option to acquire the Lithium mine by 31st May. Its already done just wait for the announcement and the start of the climb will have just started. The bigger players are just waiting now. This a long term hold stock for those who have the nerve as the austrian land holding is only 25% explored and the Austrian locals who were involved with it in the 90's know there is a bucket load of more high grade lithium. Its just that the neighbour and owner is being a bit difficult and greedy. But I am sure that some cash and extra royalties will entice the greedy sauwerkrat muncher beer swilling greedy land owner. There is an 18m "inferred" tonnage, which means not proven by JORC standards, just estimated. The proven stock is slightly 10% less.
This will be Lithium mine that feeds the high demand of Lithium from German green auto industry. In fact, the German government just announced that it aims to have over 1m electric cars by 2020 and it will start to buy 1000's of electric cars (http://www.reuters.com/article/2011/05/18/uk-germany-autos-electric-idUSLNE74H05D20110518) .
Where will German battery makers and Auto Giants, get their large Lithium supplies that is required for all those the batteries in the Electric cars? From Rio's Serbian Plant which also has a similar quality as ECM? Not till 2014 when Rio will bring production on line. Even if it did, its only a small proportion of what it will need to supply the huge lithium needs. This ECM lithium acquisition, will be the mine that will feed the german hunger for lithium. Importing it from Argentina and Chile? Too far, even though Chile is the future "Saudi Arabia" of Lithium. Australia? No, Galaxy has pre-sold every pound. If you were BASF, VW or Benz, would you not go local to Austria to do business, where it is easier with a neighbouring and germanic speaking country with high reliability and strong work ethic? If the germans were smart, they would be securing it all of ECM's potential lithium annual production of 137,000T is pre-sold. This may have already even happened and then finance for the project processing plant would be much easier. Imagine if they did get the finance? Have a look at the charts for Galaxy resources as it climbs past the hurdles of acquisition, feasability, pre-sale of production and then receiving bank finance. Now, think ECM. That should get the punters dreaming a bit. Think ahead and profit.
The germans are strategic masters of resources like the Chinese. They have geo-political ambitions as well. That would be nice punters??
To be continued from a Galaxy far, far away......
ECM Price at posting:
45.0¢ Sentiment: LT Buy Disclosure: Held
