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Rare Earth

Critical Electric Vehicle Battery Bottleneck in China?

August 29, 2022 By admin Leave a Comment

In this Article

  • Inflation Reduction Act EV Allocation
  • Without these metals, we don’t have EV batteries…
  • Extract and process these metals?
  • The reality is…

A large chunk of the $369 billion to be spent for “energy security and climate change,” as part of the Inflation Reduction Act, is allocated towards electric vehicle (EV) subsidies.

The subsidies provide a $7,500 tax credit at the point of sale for a new EV. The idea, of course, is that it will act as an incentive for us all to transition to EVs and CO2 emissions will be reduced.

As we’ve reviewed before, if the majority of our electricity is produced by fossil fuels – as it is, almost everywhere on the planet – carbon emissions won’t be reduced by shifting to EVs. Some have even argued that emissions will increase, as typically 7–15% of electricity is lost in transmission from the power plant to the end user. That’s just the nature of the inefficiency of the distribution of power over our current infrastructure.

But let’s set those inconvenient truths aside for a moment. Is it even possible for the automotive industry to produce enough new EVs to hit the targets set aside for 2030? I recognize that it’s a moot point, given the nature of how electricity is produced, but the exercise will reveal something quite interesting.

It is possible to produce enough of the new vehicles, the cars themselves, but – and this is a big but – it won’t be possible to manufacture enough EV batteries to “fuel” them. The fundamental problem is with the EV battery supply chains.

And at the very beginning of the supply chains are the metals that need to be mined and extracted from the earth, and ultimately processed for use. It’s a destructive and very dirty process that leaves massive “scars” on Earth’s surface – and produces immense amounts of carbon emissions. And yet without these metals, we don’t have EV batteries…

[MAJOR BUY ALERT: EVs/Wall Street/Gains]

The problem is that with these massive targets for EV production set by countries around the world, the politicians and policymakers (especially those in the U.S.) didn’t think much about the details of whether or not the targets were possible. Or for that matter, whether or not the process would be “clean” and actually result in lower emissions.

In order to meet these grand goals of EVs everywhere by 2030, the world will need to mine and extract critical metals from the ground. The need is no small task either, as seen in the above chart… 50 new lithium mines will have to be built, 60 new nickel mines will have to be built, and 17 new cobalt mines need to be built.

The automotive industry is already struggling with shortages of these metals, as well as with securing future supply, yet the policy targets established within require more than a 5X increase in kilotons (kt) in lithium production, 2X in nickel, and almost double in cobalt.

Making matters worse, on average it takes 7–10 years to get permitted to build a mine in the U.S. And that’s right… in just eight years it will be 2030. How’s that going to work? 

Some other countries, particularly in developing markets, are able to permit in shorter periods of time, but it is still a multi-year process. Further, what about the practicalities of the “where” and “how” to extract and process these metals?

[Enrique Abeyta Prediction: My #1 EV Stock for 2022]

Cobalt is almost entirely mined in the Democratic Republic of the Congo, not exactly an anti-fragile location for a key material in a supply chain.  More than half of nickel production comes from Indonesia, the Philippines, and Russia. 

The majority of the rare earth metals are all mined in China… critical metals used not just in EVs, but most forms of advanced electronics like our smartphones.

And the majority of the world’s lithium is mined in Australia and Chile. While these locations are politically stable, it’s the required step up in production – more than 5X – that’s the problem.

But even if we assume that somehow the permitting of new mines magically happens within the next two years, and the metals can be found at the scale that is necessary to meet demand, there is one more sticky problem…

The majority of the processing of these metals takes place in China, not exactly the location that I’d choose for a secure supply chain right now. The reality is that extraction and processing of these metals is a very dirty and fossil fuel-intensive business, which is why the western world was happy to offshore these tasks to developing markets.

And now, the implications of those decisions are being felt across supply chains. These metals are not only important in the context of battery production, but in many cases, are considered to be matters of national security. 

The reality is that China has a chokehold over these metals and can control how much of each are exported to the world. And of course, its own country’s needs will be prioritized over others.

It’s great to have aspirational goals and objectives with regard to clean energy. My sincere wish is that we transition the entire power production infrastructure to clean energy produced from technology like nuclear fusion.

Sadly, these tax and spend stimulus packages have no chance of achieving their targets. “They” neglected the most basic and fundamental inputs required to meet stated targets. 

Even worse, all of this spending will enrich a small number of vested interests, very wealthy individuals, and politicians… at the expense of normal taxpayers.

[Nomi Prins: 10x Gains on a Small Firm Disrupting a Critical American Industry]

Read more from Jeff Brown at BrownstoneResearch.com

Filed Under: Energy Storage Tagged With: Batteries, China, clean energy, Electric Vehicles, energy storage, International, Jeff Brown, lithium, Nuclear, Rare Earth, Supply Chain

1 Stock to Profit from Growing Demand for Uranium…

May 9, 2022 By admin Leave a Comment


In this Article

  • Nuclear Around the World
  • Heavy Metal Leader
  • The Perfect Time for Investors to Get In

I’ve written a lot about renewable energy’s role in lowering our carbon footprint. But that’s not the only way we’re keeping carbon emissions in check.

Nuclear power makes carbon-free electricity. About 10% of the world’s electricity comes from 440 nuclear power plants.

Here in the U.S., 18.9% of our power is nuclear. However, nuclear power plants cost too much to build and operate.

Wind and solar are much cheaper alternatives. As a result, there will probably never be another big nuclear power plant built in the U.S. after the two currently under construction are completed.

But that’s not the case elsewhere. Today, there are 51 reactors being built worldwide, with 100 more planned.

This image has an empty alt attribute; its file name is 20220427_PT_NuclearReactors_Chart-768x715-1.jpg

As these plants are finished and put into service, they will need fuel. And that fuel will be made from uranium.

Nuclear Around the World

Uranium is one of the heavy metal elements. Utilities have used it as fuel for nuclear reactors for more than 60 years.

And it isn’t used just in commercial reactors. Defense, medicine and several other industries all use uranium isotopes.

Australia holds 28% of the world’s uranium resources. But Kazakhstan is the world’s largest producer of the heavy metal.

The demand for uranium has been fairly steady for years. But many of the new reactors being built today will come online during the next decade.

As a result, existing uranium stockpiles will quickly disappear. And that will cause demand to rapidly increase.

Last year, the demand from existing nuclear reactors was about 62,500 metric tons. By 2030, it’s expected to increase to 79,400 metric tons.

And by 2040, it should hit 112,300 metric tons. That’s nearly double today’s usage…

Which spells big opportunity for any company that mines uranium…

One U.S. company in particular mines not only uranium but a whole lot more as well.

[New Battery Breakthrough: Could Revolutionize the $2 Trillion Automotive Industry]

Heavy Metal Leader

Mining uranium is one thing. But Energy Fuels (NYSE: UUUU) mines a lot more than just uranium.

Its mines yield many of the raw materials clean energy needs. But let’s start with uranium.

It’s the company’s bread and butter. And Energy Fuels has been the biggest U.S. miner of uranium since 2017.

Its uranium mill and its two mines are developed and licensed. And it’s building five new mines in Wyoming, Utah and New Mexico.

The company also has a uranium recycling operation. In addition, it’s testing its existing process streams for the recovery of radio isotopes. These are used in emerging cancer therapies.

Energy Fuels also mines rare earth elements and vanadium, which is used to make steel and high-strength alloys. So it has advantages over its seven North American competitors, all of which mine only uranium.

But Energy Fuels’ biggest advantage is in rare earth elements. One of the highest rare earth element-bearing minerals is monazite.

Mining monazite is difficult because it also contains uranium, thorium and other radioactive elements. These need special handling.

But that’s no problem for Energy Fuels.

Its White Mesa Mill in Utah is the only place outside of China that can process monazite. It has the licenses and processes to separate out the radioactive materials.

Last year, the company began to process monazite on a commercial scale. The White Mesa Mill has a license to process 720,000 tons of monazite annually.

Today, it’s producing just 1,000 tons per year. But it plans to rapidly ramp up its annual production to 15,000 to 30,000 tons. Energy Fuels recovers about 50% of the feedstock as finished rare earth carbonate and uranium.

The Perfect Time for Investors to Get In

Energy Fuels claims it’s becoming the “Clean Energy and Critical Mineral Hub” of the U.S. And I can’t think of a better materials company to invest in.

As the demand for uranium, vanadium and rare earth elements grows, Energy Fuels’ shares should skyrocket.

Savvy investors will want to come along for the ride.

Good investing,

Dave

[Forever Battery: The Best EV Stock as Solid-State Batteries Fuel a 1,500% Surge in EV Sales]

Read more from David Fessler at ProfitTrends.com

Filed Under: Nuclear Tagged With: David Fessler, Defense, Energy Fuels, International, Medicine, Mining, Monazite, Nuclear, Rare Earth, Uranium, Vanadium

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