FOR at least the past five years it has been pretty obvious that the advent of electric cars, digital cameras and smart phones was going to put a rocket under the demand for compact batteries, and unless someone came up with a revolutionary new technology, that would mean the price of lithium would go through the roof.
It did.
So now every junior explorer with a tenement or two is re-analysing their old rock chips for lithium, or bidding for additional tenements thought to be prospective for the stuff.
Monax Mining (ASX code MOX), Capital Mining (CMY), Archer Exploration (AXE) and Sayona Mining (SYA) are just four of the latest to jump on the bandwagon.
But it will take years, and millions of dollars which they don’t have, for these and similar companies to produce lithium, even if they find the ore in economic concentrations.
The big one is Pilbara Minerals (PLS) which reckons that its 30 million tonne Pilgangoora lithium-tantalite project could generate gross earnings of $120m a year. Commission is scheduled for the end of next year. The shares are up about 1,300 per cent over the past 12 months, though, so The Punter reckons he’s missed that one.
Only three quoted Aussies are actually mining and selling lithium. They include General Mining (GMM), Galaxy (GXY) and Orocobre (ORE). General Mining is earning a 50 per cent stake in Galaxy’s Mt Cattlin mine, which it has reopened.
The Punter has already doubled his money on Galaxy (and sold half the holding) and is happy to sit on the rest. Orocobre, which is producing battery grade lithium carbonate from brine in Argentina, is a bit too established and expensive for a fly-by-night like The Punter.
But Lithium Australia NL (LIT) has caught his eye. The Punter has put in a cheeky bid for 10,000 LIT at 15 cents – about 10c below the market.
• The Punter has no financial qualifications and no links to financial services. He owns shares in a number of companies featured here.