Member Info for jimb2

No surprise, 11 minutes ago:

Mexico's Senate approves legislation to nationalize lithium

Core blimey, news over the next few days will be interesting - I'm feeling tired with all this lithium talk, probably just an Iron deficiency!

@EV_Bull,

more than one supply deal I would say, Tesla Texas Cybertruck and Tesla Semi but VW also:

March 2022

VW said it will introduce 25 EVs to North America by 2025 and will expand battery production on the continent to feed its EV ambitions.

Where might that be:

https://cleantechnica.com/2022/03/22/volkswagen-plans-7-billion-investment-to-build-electric-cars-in-north-america/

And some drivel from the weekend, too much detail to post, but Ganfeng plans battery production in Mexico, and as far as I can tell this was the first publication mentioning so, and again March 2022 – for anyone looking DYOR seems legit to me with the accuracy of other content:

https://newsrnd.com/news/2022-03-15-ganfeng--%22we-are-going-to-continue-in-sonora-because-the-laws-of-mexico-allow-lithium-to-be-exploited%22.rJfzAYYpZq.html

Or lithium compounds and battery cells for predominately North America?

The United States–Mexico–Canada Agreement (USMCA), which went into effect on July 1, 2020, included a number of changes to the rules of origin for the automotive sector. The USMCA requires that 75 percent of a vehicle’s content (70 percent for heavy trucks) be produced in North America, and that core auto parts originate from the United States, Canada, or Mexico. Following a phase-in period ending in 2023 for vehicles and 2027 for trucks, only goods meeting these content requirements will receive duty-free access. For additional information, please visit the Office of United States Trade Representative (USTR) website (www.ustr.gov) or see USTR’s USMCA U.S Automotive Sector Impact Analysis.

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My thoughts, Ganfeng will produce batteries cells in Mexico from Sonora lithium in 2024 for North America and possibly for more than one manufacturer - Perhaps powertrains?

DYOR

https://kesq.com/money/cnn-business-consumer/2022/04/19/volkswagen-is-coming-for-tesla-heres-how-it-plans-to-dominate-the-us-market/

Keogh: The upside is that it’s all going to happen in the US locally because it’s too expensive and risky to be shipping tons of cobalt and lithium across the ocean. This takes America back to when we said we want to be Apple and not Foxconn — we were going to focus on design jobs, engineering jobs and software jobs, but someone else would make the product. That’s not going to be possible with batteries, you can’t ship something that weighs a couple of thousand of pounds for 15 million cars from China, it’s going to be a transformation.

Well, I remember commenting on this:

https://www.electrive.com/2019/04/06/volkswagen-and-ganfeng-launch-lithium-cooperation/

How things have progressed in three years - 17,500t/pa to 50,000t/pa

@EV_Bull,
I would hope that's clarified, todays buzzword is 'reviewed' you are correct @EV_Bull but it does create uncertainty.

The US$420mn Sonora project (in picture) is Mexico’s only large, advanced lithium asset, with production currently expected to start in 2H24.

“The bill that the president sent says absolutely nothing about the concessions that have already been awarded and explored,” CIMMGM’s Alatorre said. “This creates great legal uncertainty for these investments that have already been made.”

According to the AIMMGM, concession-holders’ rights will not be affected by the changes outlined in the bill.

https://www.bnamericas.com/en/features/mexico-lithium-reform-faces-legal-pitfalls

GL

Today’s picks,

The project with the greatest progress, however, is that of the British company, formerly Canadian and today Chinese, Bacanora Lithium, in Sonora, which is considered by some specialists as “the lithium mining project with the largest proven reserves worldwide.

https://www.infobae.com/america/agencias/2022/04/19/presidente-mexicano-dice-todos-los-contratos-de-litio-seran-revisados/

The Chinese news agency Xinhua reported on Tuesday that the president of the Asian country's parliament, Li Zhanshu, spoke by videoconference with the head of the Mexican Senate, Olga Sánchez, to "further improve relations," but it did not come out whether they spoke about the changes to the mining law.

Who's looking!

https://www.forbes.com.mx/gobierno-revisara-si-contratos-de-ganfeng-lithium-le-permiten-explotar-litio-en-sonora/

In this regard, the federal president pointed out that the United States government requested information from Mexico on this share transfer and whether the contracts granted are fully in accordance with national laws.
“The issue of lithium has been discussed because there was a contract that was transferred, it was sold in Sonora that was in the hands of an English company and passed into the hands of a Chinese company and then there were requests for information about why that had been delivered. permit.

And the ambiguity:

https://www.bnamericas.com/en/features/mexico-lithium-reform-faces-legal-pitfalls

Asked in February about whether Bacanora Lithium and Ganfeng Lithium’s Sonora lithium project concessions will allow the asset to be mined by the companies, AMLO said: “No, no. The nation will exploit lithium.”

Today:

https://www.lapoliticaonline.com/mexico/politica-mx/lopez-obrador-confirmo-que-revisara-contratos-en-torno-al-litio-entregados-a-privados/

President Andrés Manuel López Obrador indicated that the authorized contracts for the exploitation of lithium in Mexico, granted to the Chinese company Ganfeng Lithium to exploit the mineral in Sonora, will be reviewed.

Final vote:

https://www.americanpost.news/mining-law-reached-the-senate-for-analysis-discussion-and-vote/

Now that the Mining Law has reached the Senate, it is sought that there be no concessions or contracts for the exploitation of lithium. Morena will support the Executive’s project to reform the Mining Law.
The Mining Law seeks that there are no concessions or contracts for the exploitation of lithium and establishes that this is the sole responsibility of the State, for which a decentralized body will be created for this purpose.

Sánchez Cordero indicated that the document that contains the text approved in the Chamber of Deputies “was turned over to commissions for their analysis and corresponding opinion. Later it will be analyzed and voted on in the plenary session” of the Senate.

Indeed @EV_Bull,

I do wonder if Ganfeng possibly has an NDA (s) in place that is pending the clarification, as we have discussed the wording on the concessions has changed over several months, and now with the outcome of both votes is out of the way and just the fine detail to be published could see news released - just a possibility but EV supply chain news is popping up weekly with $billions being invested.

That uncertainty has been hanging over the Sonora project for several months and must be holding back any JV's so I'm looking forward to a definitive answer.

Plenty popping up in the press, fingers are crossed for a positive outcome.

Considering that it has deposits for exploration in Australia, China, Sonora, Ireland and Mexico, Ganfeng is not only a company that extracts ore from clayey soils such as that of the Bacanora Project (which, in addition, requires a lot of energy to function on site) , but is also a producer of lithium batteries and is the main recycler of the mineral in batteries, both for cars and electronic equipment, wouldn't it be better for the Mexican State to associate itself in the terms that Chinese companies have done: ensuring technology and knowledge transfer?
Ganfeng already has long-term contracts with VW, BMW, Tesla, for example, and is a listed company in Hong Kong and China.

I bring this up because, with the approval yesterday in the Chamber of Deputies of the reform to the Mining Law on lithium, it seems evident that President López Obrador evaluated the cost of revoking the 10 mining concessions.

https://www.dineroenimagen.com/alicia-salgado/mitos-y-realidades-sobre-el-litio-mexicano/143224

Interesting week ahead that just might see KDNC elevated in the news, I would expect clarification on Ganfeng's position will be demanded very shortly.

@cyfalafwar,

have you heard of Grammarly browser extension - it will tidy up your posts for grammar and typos for free.

LG Energy Solution announced on Monday that it and Indonesia's government will spearhead efforts to forge a seamless
supply chain for electric vehicle batteries in the resource-rich Southeast Asian nation. The supply chain will span from the mining of raw materials to the production of EV batteries. Total investment could reach about $9 billion, according to a source with knowledge of the project. The partnership is especially keen to secure a stable supply of nickel, for which prices are soaring.

And another supply chain agreement, look at what Mexico is likely to miss out on if Sonora doesn't get the go-ahead:

Worth repeating:

https://newsrnd.com/news/2022-03-15-ganfeng--%22we-are-going-to-continue-in-sonora-because-the-laws-of-mexico-allow-lithium-to-be-exploited%22.rJfzAYYpZq.html

“Our plan is to have a company that dominates the entire lithium value chain in Mexico: that not only includes the mine, but also the production of batteries and their recycling.

This was prior to the invitation for the US car manufacturers to JV with Ganfeng.

Correction,

the ambiguity still remains, but the news is spreading!

Once the new Mining Law has been approved, it will be necessary to see the situation of the concessions already granted to foreign companies to exploit lithium, especially in Sonora, where the Chinese, English, Canadians and Italians have monopolized the large reserves of that mineral in the entity, for which a great legal dispute and litigation are predicted that will last for years, in addition to the fact that millions of sums of compensation will have to be paid to investors if their contracts are cancelled, since they have already invested hundreds of millions of dollars in exploration alone.

@Olderandwiser,

as we now see the vote went through and all the ambiguity around whether the existing concessions would be nationalised, if you check over the last six to nine months you will see the wording has changed and only yesterday did it say 'prior' concessions.

I did post the definitive answer would hopefully be known by today and I was looking forward to Ganfeng's response as well as the US,

have you mulled over this?

https://hsfnotes.com/latamlaw/2022/03/22/mexicos-new-policy-on-the-lithium-industry/?utm_source=Mondaq&utm_medium=syndication&utm_campaign=LinkedIn-integration

Views welcome on the likely litigation as covered in that article!

Let's see how the week unfolds, remember the last interview still had years eight to nine for our concession to come into play, I would be very surprised if Ganfeng let Sonora slip through their hands and the US don't respond, and perhaps the Chinese government.

Thus, with a vote of 298 demonstrations in favor, 197 abstentions and zero against, the Mexican state will have the unique powers of exploration, exploitation, industrialization and the integral use of lithium

If anyone is concerned (I'm not) this covers some of the litigation that might result in a vote in favour of AMLO's bill:

https://hsfnotes.com/latamlaw/2022/03/22/mexicos-new-policy-on-the-lithium-industry/?utm_source=Mondaq&utm_medium=syndication&utm_campaign=LinkedIn-integration

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Should send the lithium market buzzing and some coverage for KDNC!

well, this seems explicit with the reference to having 'prior' concessions!

What does the reform contemplate to nationalize lithium?
The reform contemplates that in the case of lithium there will be no concessions or contracts because it will be “of the nation and administered directly by the Mexican State.”

The initiative has created controversy because the company with Chinese capital Bacanora Lithum now has a concession in Sonora, which would allow it to extract 35,000 tons of lithium carbonate per year.

This is considered one of the largest mineral deposits in the world, with 8.8 million equivalent tons with reserves that would last 250 years.

But López Obrador reiterated that his government will not allow foreigners to exploit lithium even if they have prior concessions.

Instead, there will be a State company “to exploit, explore, extract, process, industrialize and sell it”.

https://then24.com/2022/04/18/amlo-asks-deputies-and-senators-to-protect-lithium/

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let's see how the vote goes and any responses.

I'm not sure if the prior link has been posted before but some very interesting revelations other than the battery production, we have some figures $3bn investment with $1bn in the next five years, however, that was dated 15th March so was prior to the invitation for US car manufacturers to invest - maybe several $bn is more likely.

The Sonora project has so far cost 50 million dollars and the mining company plans to spend another 3,000 in the extraction and manufacture of batteries in the future. Of that amount, around 1,000 million will arrive "in the next five years," they say.

And CATL is not shy with investment overseas and just like Ganfeng the full supply chain.

CATL on April 15 announced a partnership, through its holding subsidiary Ningbo Contemporary Brunp Lygend Co., Ltd., with PT Aneka Tambang Tbk. (ANTAM) and PT Industri Baterai Indonesia (IBI) to jointly invest and build power battery industrial chain projects at the FHT industrial park and other related industrial parks in Indonesia. Total investment for the project is estimated at no more than USD5.97 billion. All parties agreed to establish an end-to-end EV battery industry in Indonesia which will integrate mining, smelting, production of precursor, anode and battery, as well as battery recycling.

Our time must be close to realising the true mcap value from Sonora, I just don't see Ganfeng wanting KDNC in any talks with the future of Sonora.

A mere 5% of $3bn is $150M - cheap?

https://newsrnd.com/news/2022-03-15-ganfeng--%22we-are-going-to-continue-in-sonora-because-the-laws-of-mexico-allow-lithium-to-be-exploited%22.rJfzAYYpZq.html

“Our plan is to have a company that dominates the entire lithium value chain in Mexico: that not only includes the mine, but also the production of batteries and their recycling.

We are the only company in the world that combines lithium mining, mineral processing, battery manufacturing, cells and battery recycling”,

@Legalease

Mexican President Andrés Manuel López Obrador (AMLO) has signed off on a proposal to protect national lithium interests that will go to congress on Monday should constitutional electric power sector reforms fail to pass the lower house on Sunday.

Seems we will know before markets open on Tuesday whether the bill permits Ganfeng to mine the concessions for sure!

I would imagine the Chinese government is instructing companies to secure even more overseas lithium, I do recall around 2019 they did similarly.

US lithium carbonate imports increased 460% YOY in December 2021.

I'm sure over the course of the next few days many more people will be aware of KDNC and the Sonora JV's, as we should remind ourselves Sonora is easily scalable Ganfeng didn't publish the mine plan update due in May last year and as all we can fathom is they have purchased more land 500 hectares and are looking at 50ktpa phase one from 17,500K, also made the announcement for US car manufacturers to take an interest in Sonora.

I wouldn't like to be out of this at the moment, just imagine if the likes of Ford, GM, or Tesla are eying up Ganfeng's offer awaiting clarity on the Sonora concessions!

Perhaps some have been doing so for months.

Does the outcome if definitive warrant an RNS?

Some good detail here, and the first time I have noticed lithium is listed as a mineral that can be 'exploited'

https://dossierpolitico.com/vernoticias.php?artid=264005&relacion=dossierpolitico&categoria=2

For the exploitation of lithium to be exclusive to the State, the Mexican government must modify articles 4 and 5 of the Mining Law, said the president of the College of Mining Engineers, Metallurgists and Geologists of Mexico (CIMMGM), Armando Alatorre.

In comments to MILENIO, he stressed that first they will have to delete this mineral from article 4, paragraph one, where the materials that can be exploited by private parties are explained, and then in article 5 add lithium and explain why it is only for the government.

In comments to MILENIO, he stressed that first they will have to delete this mineral from article 4, paragraph one, where the materials that can be exploited by private parties are explained, and then in article 5 add lithium and explain why it is only for the government.

And this point:

He stressed that the big mistake they made the Federal Executive believe is that lithium is the new oil, when he states that it does not generate energy, it only stores.

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Hopefully plenty of press around Sonora in the coming week, we can't stay unnoticed for much longer!

LFP gamechanger, well I was pretty sure the BYD blade battery was a gamechanger, seems in July it was neck and neck across the chemistries, and then - blimey LFP took off!

https://www.benchmarkminerals.com/membership/benchmark-launches-lithium-ion-battery-raw-material-price-index/?mc_cid=33376d4c57&mc_eid=2ee1472142

And add to that Gotion who also has great LFP tech:

https://youtu.be/_M_GlXlDjo8

Sonora - OMG!