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Column: Automakers rush in where miners fear to tread
Reuters | March 3, 2023 | 7:57 am Battery Metals Intelligence Top Companies Europe Latin America USA Copper Lithium
Automakers rush in where miners fear to tread
Ford’s First Model in 1892. (Stock Image)
The race for electric vehicle (EV) battery metals is heating up.

Automakers can’t go green without having sufficient quantities of the lithium, nickel, and cobalt that make the batteries work.

SIGN UP FOR THE BATTERY METALS DIGEST

Fear of missing out, quite literally, is generating an industry-wide shift to investing directly in the mining sector to ensure future supplies of battery inputs.

General Motors Co has announced a $650-million investment in Lithium Americas Corp to help fund the development of the Thacker Pass project in Nevada.

GM gets exclusive rights to 40,000 tonnes per year of lithium from a domestic mine, which is key to qualifying for the EV subsidies available under the Inflation Reduction Act.

Carmakers have already been busy tying up supplies of battery metals under direct off-take agreements with existing metals producers.

Now they are getting into the business of actually digging the mines, or at least helping with the finance.

The investment rush has until now largely played out in the lithium sector but French-Italian carmaker Stellantis has just pivoted into copper with an investment in an Argentinian project.

Copper pivot
Stellantis, the third largest automotive group by sales, will pay $155 million for a 14.2% stake in McEwen Copper, a subsidiary of Canada’s McEwen Mining, which owns the Los Azules project in Argentina.

The deposit, ranked in the top 10 global undeveloped copper resources by Mining Intelligence, is expected to yield 100,000 tonnes per year of the refined cathode from its anticipated start date in 2027.

The automaker’s investment comes with an option to purchase the mine’s output at a ratio equivalent to its equity ownership.

With the help of existing shareholder Nuton, a subsidiary of Rio Tinto, and its copper leaching technology, McEwen is aiming to make the mine carbon-neutral by 2038, adding to the project’s green credentials.

Copper is an often forgotten component of EV batteries, but it plays a critical role as a current collector. All battery chemistries require copper, albeit to varying degrees. Lithium-iron-phosphate batteries, a burgeoning part of the EV market, need around 50% more copper than nickel-manganese-cobalt, according to the International Energy Agency (IEA).

Outside of the battery pack copper is also used in the electric motor, the busbar, and in what can be up to a mile of internal wiring.

The amount of copper used in a typical battery electric vehicle is 83 kilograms, compared with just 23 kilograms in an internal combustion vehicle, according to the International Copper Association.

Fear of falling short
Stellantis’ leap upstream in the copper processing chai

A by the way, I did not make a bet on it raining in the sahara.
I made an investment in a junior exploration company that had a blueprint to find, sell and explore.
The next major in the making was not on the table in 2013 when I invested a not immaterial amount.
No-one asked me about the change in strategy.
Cornerstone and malcom Norris found the deposit. Nick just took the farm in. I don't think he was that great looking back over everything.
Look how the new CEO described the culture at the company.

Bozi
Yes it was not impossible but to most people it seemed highly unlikely that the dream would ever become a reality. And in my opinion that cost us dearly.

Actually I would say you are unlikely to get anywhere in a debate or negotiation if you try to ridicule the opponents views or values.
Your tone Comes across as condescending to say the least.
The let's go to production point of view had very little chance of happening , you have basically admitted that.
Selling it was always the more likely.
So which ultimately made more sense from a business point of view?
What side of the argument has been backed up?

Just for balance
Can the people who ridicule the " let's get it sold " Brigade name in the history of mankind the last time a penny stock backwater company became a major in the mining space?
Because basically that is what you are saying by listening to the company.
Sounds ridiculous really doesn't it, when you say it in black and white.
I can win a game of monopoly and state that within 10 years im going to own wall St.
Only your mother a few nutters and obviously a few on here would believe it and still try to make themselves look start.
I actually think Mather has made such a fool of himself that he will retire after this. Just he has managed to take a few along with him on this board.

Bozi
You sound like you know what you're talking about most of the time,
But do you have to do it in that irritating way that Quady is so fond of, where by you state your point of view by trying to make everyone else look stupid who thinks differently. After all it's only just opinions we have. Yours included.

And ps
If you do get a good price and soon maybe someone is the blind one after all.

Mathers relationship with cornerstone/ shanga/ irvin/ bhp / newcrest was in tatters. Great way the run a company.

Also our original board was all for the merger in the best interests of shareholders. No one put a gun to their heads.
They knew the days of travelling around the world first class going to event after event saying the same stuff over and over again and delivering so little in the last 5 years could not go on anymore.
The PR guy on 400k a year must have been rubbing his eyes every morning and thinking he was dreaming. He was not dreaming he was just a member of the solg gravy train that the cornerstone boys thankfully called time on.

One day when this is all done and dusted someone on the inside will actually tell what was happening behind the scenes. Ive got a feeling Nick Mather and one or 2 others will not come out of it smelling of roses.

I can confirm
There was a man down the pub who did indeed say Rio were interested.

Trouble is Broke
Our own management proved to be all talk and no substance and they got away with it for years imo
I'm glad the new boys are now running the show.

I was thinking of saying something funny.
But I did not want to upset the people who are not happy when the price is going up.
They come on and insult anyone being happy.

Come on guys, have you not realised yet that these people don't invest to make a return,but only to guide the nieve newbie.
Got to love them, hey?

Hi Broke
We have certainly got a new one now, maybe more

This week goes to show how quickly this share can move.
Even Just with a wiff of rumour.
Imagine when it's confirmed.
We could have another 2011 solomans moment.
One of the issues I have with the doom team, goes back to the ericeric days.
That piece of t#rd talked this share down day after day week after week and month after month. This was back in the days when the share was around 3p for an age.
It finally popped and within weeks it was over 40p.
I asked him to apologise for all the people he purposely tried to discourage from investing.
Needless to say he was never seen again on the board to this day.
I wonder if we do get a bid if the resident muppets will stick around this time?
Some how I doubt it.

Thank you Fort
I will from now on.

Looking good now.
New Low life's turning up to throw cold water on the uplift.
Nothing quite like understanding human nature to lead you on the right path..

I don't recall it usually being that big. New posters who just showed up here

Wow. Somethings cooking! And it smells good.

How big? I can't see it yet?

Mr you know who.
He said yesterday it would rise again today and then consolidate.