Luc Duchesne reports that much of the lithium in the world is produced by Albemarle, Sociedad Quimica y Minera de Chile, and FMC from Argentina, Chile, Bolivia, Australia and eastern China, and is shipped long distances to battery makers in Asia. But Western Lithium holds the Kings Valley lithium deposit in Humboldt County, Nevada. Unlike most lithium sources, which are either hard rock or brine based, Kings Valley is a clay project. Western Lithium has a separate business aimed at commercializing hectorite clay products for use in oil and gas drilling. Permitting and Environmental Studies for the Kings valley lithium project is ongoing with a lithium demonstration plant that commenced in fall 2014.
The targeted production is 2018 or 2019. Tesla should be the second favorite word of Western Lithium shareholders because the Tesla Gigafactory is located in Sparks, Nevada, some 238 miles away from Humboldt County. Tesla broke ground on the Gigafactory in June 2014 outside Sparks, Nevada, and expects to begin cell production in 2017. By 2020, the Gigafactory should reach full capacity and produce more lithium ion batteries annually than were produced worldwide in 2013. But Tesla is showing an unconventional approach to meet its needs for lithium feedstock. When Tesla chose Nevada for its Gigafactory, analysts speculated that the state significant lithium supply was one of the attractions. Last September Tesla announced it plans to buy lithium from Pure Energy Minerals, some 200 miles away near Reno, Nevada.
A third favorite word of Western Lithium shareholders is that the company is currently negotiating with POSCO and expecting the completion of an agreement during the fourth quarter of 2015. At this time the parties have agreed that POSCO will contribute to the joint venture the right to use its proprietary lithium extraction technologies for the production of lithium carbonate and lithium hydroxide in Argentina.
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