EMH POST16 Sep 2020 07:28
Posted by enteleon
I don't think the World has yet fully woken up to the likely mineral supply-side crisis of the future regarding lithium/nickel/cobalt. EMH is rather under the radar, which, for intelligent investors makes its SP look very cheap at present. I believe that EMH stands as one of the most de-risked and undervalued lithium plays because:
1) Its Cinovec project is of considerable magnitude with extended mine-life.
2) Location neighbours Saxony and is almost perfect for the German motor manufacturers (+Tesla?). Logistical access good. Power and water supplies good. History of mining (tin) at Cinovec, with support of local ex-mining community, unlike the deposit in Portugal.
3) Heavily supported by the CEZ Group, itself 70% owned by the Czech Govt.
4) Sentiment among the influential EU nations is shifting seriously towards EVs, renewable energy and lithium-based power storage to iron out the fluctuation in wind/tide/solar power generation.
5) Hard-rock (Zinnwaldite) deposits may have significant advantages over brine and clay deposits as far as the environmental impact of the mining is concerned. Chilean Govt expressing concerns over the water husbandry at its major Atacama brine deposits. Similarly with the Mexican Govt regarding its clay deposit at Sonora.
6) Some concerns over political influences such as the Mexican Govt imposing taxes on any exported minerals.
7) Considerable tensions between Australia ( home of major Spodumene deposits) and China, the latter being by far and away the predominant force hitherto in the lithium space.
8) As has been repeated many times on this board, it is likely that, as lithium demand cranks up, demand will drastically outstrip supply, given that new mines take two to three years minimum to begin actual production.
9) Creative entrepreneurs such as Elon Musk are already way ahead in their thinking and planning. Musk is very environmentally switched on and there may be some repudiation of some of the brine/clay mining which extracts a very heavy environmental price.
10) If Joe Biden gains The White House on November 3rd, he has promised trillions of $ in support of climate change initiatives and that could drive a major change in global sentiment.
The smart money IS already making quiet moves. Talk will get rapidly converted into real action as it becomes obvious that we are heading towards a massive supply crisis of essential minerals. I believe EMH is in prime position. GLA ! Keep safe!
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