Here are four reasons to keep a close eye on International Battery Metals ( $IBAT : $RHHNF )
#1 Time is Money
The technology IBAT is acquiring-and may consider partnering with third-party lithium producers-could be a significant key to unlocking $84 billion in lithium brine resources by producing lithium faster and more cheaply.
The ambitious targets for electric vehicle (EV) deployment and energy-storage applications require massive lithium mining capacity to be built faster than current technologies allow.
That's the chief reason why companies are aggressively pursuing new resources such as jadarite and hectorite clay, and more importantly, oil field brines. Lithium brine deposits are estimated to contain 66 percent of the world's 14 million metric tonnes (MT) of Lithium. That's $84 billion worth of lithium at current prices.
Unfortunately, the recovery of lithium from brine deposits is a painfully slow process. Traditional solar evaporation technology is an extremely time-intensive process, with production cycles that can take up to 24 months.
Instead of going the traditional route of trying to isolate lithium by removing all of those complex ions, the IBAT technology removes the lithium directly.
According to Burba, the process takes the lithium out of the brine on a continuous basis. As the brine passes through the system, the lithium is collected while impurities flow right through and go straight back into the ground. The end-product is a diluted stream of lithium chloride and water that comes out as the brine goes by. That solution, which has a smaller volume and far fewer impurities than the original brine, is far easier to process.
The new technology Burba and his team will be implementing for IBAT creates a lithium extraction process that reduces an 18-24 month process to just one day., according to Burba
This paradigm-shifting technology could be highly disruptive, offering the fastest-to-production lithium brine extraction solution available anywhere. Faster means more efficient and more cost effective.
#2 Inventor/CEO + Technical and Commercial Dream Team
Inventor John Burba-a veteran in lithium extraction-is the incoming IBAT ( IBAT : RHHNF ) Chairman and CEO, and he's one of the most important pioneers in lithium extraction technologies. He is considered a genius in this space.
IBAT's to-be-acquired technology is based on a tech that Burba co-invented and sold in the 1990s when he was a leading technology figure at giant FMC.
Before Burba came along, everyone thought that lithium could be produced from only a limited number of brines.
That's where Burba's genius came into play. FMC has been using Burba's "old" first-generation methods for nearly 20 years, and FMC is responsible for making the purest primary lithium carbonate in the world. It's even earned its own lithium label: "FMC-grade" lithium carbonate.
This inventor/CEO has already revolutionized lithium processing once. Now he's bringing other lithium industry veterans with him, and they are determined to do it again, this time leading a company that promises to pack a professional punch.
#3 IBAT Hits the Brine, Running
Entering the lithium business just this year, IBAT ( IBAT : RHHNF ) has hit the ground running and has reason to be confident in the commercial viability of its advanced technology. Who wouldn't be with the genius in this space who helped design FMC's super-efficient lithium extraction process and his hand-picked designers and professionals?
Oil field brines are a potentially staggering resource. Lithium has been found extensively in North American oil field brines, and Burba and his team have evaluated hundreds of these fields. Lithium is best produced from the right brine, so, this way, once IBAT finds the best brine out there, they will be ready to strike. Again, this could like a potential shale revolution - but for lithium.
IBAT anticipates that by 2020 it will become a supplier of various battery metals. And by then, well, demand should be out of this world.
#4 Supply and Demand
With global battery demand predicted to rise 7.7 percent to $120 billion by 2019, and with the lithium market alone set to reach $1.7 billion , this market won't wait for evaporating ponds.
The global lithium-ion (Li-ion) market is expected to exceed $46 billion by 2022, growing at nearly 11 percent CAGR. What the world needs right now is a plentiful supply of high-grade lithium to power the unfolding EV revolution.
There's more upside risk here because of the incredible battery demand, according to Bloomberg New Energy Finance's Andrew Grant.
A Tesla 70kWh Model S battery pack contains 63 kg of lithium, equivalent to the amount of lithium in 10,000 cellphones. Tesla will use up the entire world's current supply of battery-grade lithium when it hits a production clip of 500,000 Model 3s in its giant Nevada gigafactory sometime in 2018. When Tesla opens up its four more planned gigafactories, there just will not be enough lithium to go around.
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