NetworkNewsWire
Editorial Coverage: The impressive increase of electric
vehicles (EV) is creating a significant increase in demand battery
minerals, a demand that is fueling growth for mining companies,
especially for those with operations in Indonesia, one of the
world’s top producers of battery minerals.
Bolt Metals Corporation (CSE: BOLT) (OTCQB: PCRCF)
(XFRA: NXFE) (BOLT
Profile), one of the companies working in Indonesia,
recently announced a name change as it rebrands itself a leading
resource developer in this growing market. Several leading auto
makers are contributing to the surging EV market as they focus on
manufacturing quality electric vehicles. For the third year in a
row, Honda Motor Company Ltd. (NYSE: HMC) has
earned the Kelley Blue Book Plug-in Hybrid Car Best Buy with its
Honda Clarity model. Tesla Inc. (NASDAQ: TSLA) has
seen impressive success with its Tesla Model 3, which is one of the
best-selling cars in Europe. Toyota Motor Corporation
(NYSE: TM) just announced plans to build a new electric
vehicle plant in China. And Toyota is partnering with
Panasonic Corp ADR (OTC: PCRFY) to establish Prime
Planet Energy & Solutions, Inc., a joint venture specializing
in automotive prismatic batteries.
- Growth of EV industry expected to create two- or three-fold
increases in demand for battery minerals over the next decade.
- Home to 25% of the world’s nickel resources, Indonesia is
essential source of key minerals.
- China leads world EV-battery production; critical market for
battery minerals.
- Indonesia recognizes opportunity, focused on developing own EV
industry.
To view an infographic of this editorial, click here.
Electric Vehicles Drive Battery Metal
Market
The last decade saw significant trends in technology; some of
the most significant interest and growth was focused on the EV
industry. Once a pipe dream of green technologists, electric
vehicles enjoyed tremendous growth in the past decade. By 2018,
global EV sales had reached 2 million units, and that number is
expected to double to 4 million in 2020. In addition, the
once-lofty price of these vehicles is falling, and their battery
packs could be cheaper than equivalent combustion-engine models as
early as 2022.
This momentum is causing huge growth in the market for the
metals used in EV batteries. Industry experts
predict that the EV market will need around 1.3 million tons of
nickel each year by 2030, compared with 600,000 tons in 2018.
Cobalt is facing a similar rise in demand, with experts predicting
a 332% increase in global supply from its 2017 levels, to 314,000
tons per annum.
Changing Brands for a Changing Market
This growing market is driving changes in companies working in
the industry, a movement reflected in the changing strategies and
branding of business-savvy mining companies such as
Bolt Metals
Corp. (CSE: BOLT) (OTCQB: PCRCF) (XFRA: NXFE). Bolt
Metals recently announced a name change from Pacific Rim Cobalt
Corp., which is part of the company’s rebranding campaign.
To outsiders, name changes like this can look like little more
than window dressing. But for observant investors, and for those on
the inside of these changes, they often represent significant
shifts in focus. While Bolt Metals isn’t dividing or merging with
another company, its name change reflects a steady shift in line
with global markets.
“Rebranding the company is an important step in our emergence as
a resource developer in Asia’s expanding electric vehicle supply
chain,” said Bolt Metals CEO Ranjeet Sundher. “The company remains
focused on acquiring and developing production-grade, battery-metal
projects within the Asia Pacific region, while employing a
vertically integrated ‘mineral‐to‐market’ strategy to leverage
these assets to their fullest.”
Bolt Metals has been transitioning from its initial position as
a cobalt producer and moving into a broader position as a
battery-cathode material supplier. BOLT’s Cyclops mining project in northern Indonesia, a rich
source of cobalt and nickel, plays a significant part in this
transition.
But it’s the mine’s location, as much as its resources, that is
creates potential for the Cyclops project, a new direction for
Bolts Metals and a reflection of bigger changes in the EV
market.
Indonesia: The New Electric Vehicle Hub?
Indonesia boasts a rich supply of the mineral resources that the
EV industry needs. The country provides 25% of the world’s nickel
reserves as well as other metals such as cobalt. These are crucial
metals in the production of EV batteries and, therefore, in the
entire supply chain for these vehicles.
Bolt Metals’ Cyclops mining operation is designed to tap into
these valuable resources. Throughout 2019, the company has been
involved in surveys and test drilling, in addition to assessing
existing records on the mineral resources at a site in Papua
Province, on the north coast of Indonesia. This concentrated
research has confirmed the
presence of significant high-quality deposits near ground
surface at the site. TAs Bolt Metals moves forward with plans for
extraction, testing and processing, the company does so secure in
the knowledge that the minerals are not only present but easily
accessible.
The richness of Indonesia’s mineral deposits isn’t the only
reason for the country’s growing prominence in the EV supply chain.
Indonesia’s location on the rim of the Pacific gives the country a
straight nautical transport route to Japan, a major player in
developing new technology, and China. China is developing its own
battery industry, focused on becoming a leader in the production of
power cells to be used in all sorts of products. Both countries
represent significant markets for EV minerals, markets to which
Indonesia can easily cater because of its favorable geographic
location.
The Indonesian government is leveraging its advantages as it
actively works to strengthen its EV industry. Last year, Indonesian
president Joko Widodo signed a decree outlining
the government’s support for Indonesian EV production. The plan
includes reduced tariffs for companies importing equipment for EV
production, thereby making it easier for the industry to grow. New
regulations are creating a profitable space for companies such as
Bolt Metals.
Feeding the Chinese Battery Market
While domestic EV plays a critical part in Indonesia’s strategy,
the country is still open and welcoming to other markets. In fact,
several major Chinese companies are following a similar path to
Bolts Metal, investing in the Indonesian mineral industry to ensure
the supplies they need for battery production.
The significance of China in the global battery market cannot be
overstated. According to
research by Benchmark Mineral Intelligence, 88 out of 115
lithium-ion-battery megafactories around the world are located in
China. The country has carefully positioned itself as the center of
the global technology supply chain. Previously China’s power has
been most obvious in consumer electronics, but it is becoming
increasingly evident that the country is playing an important role
in the rise of EV, as reflected in deals such as
the that between Tesla and Chinese battery maker Contemporary
Amperex Technology Co Ltd.
For companies operating in Indonesia, such as Bolt Metals, this
represents a double opportunity. First, companies can become
involved in the foundation of an integrated EV market within
Indonesia, in which minerals can be delivered quickly and easily to
a fast-growing market. Second, companies can become involved in
exporting to China, perhaps the largest market for these minerals
in the world.
With rich mineral deposits and two substantial markets, Bolt
Metals and other battery-mineral companies in Indonesia are
anticipating a bright future.
A Critical Industry
The burgeoning EV industry is at the center of this bright
future, with the top auto makers around the world rising to the
challenge of producing high-quality, eco-friendly vehicles.
Honda Motor Company Ltd.’s (NYSE: HMC) Honda
Clarity has been available for three years — and has earned the
Kelley Blue Book Plug-in Hybrid Car Best Buy all three years
(http://nnw.fm/9uZGz). “Launched new for the
2018 model year, the Honda Clarity is offered in three very
distinct variants: pure electric, fuel cell, and PHEV,” Kelley
noted when announcing the honor. “While this jack-of-all-trades
assortment of powertrains may sound like Honda has made
compromises, just the opposite is true — the Clarity was engineered
as a clean-sheet design with each of those unique models in mind.
As a result, driving dynamics are excellent, cargo space and
interior utility impressive, and passenger concessions are few and
far between.”
Tesla Inc. (NASDAQ: TSLA) has seen impressive
success with its Tesla Model 3, which is one of the best-selling
cars in Europe. “Until recently European auto executives regarded
Tesla with something like bemusement,” a recent New York
Times article reported (http://nnw.fm/6duIU). “The electric car upstart from
California was burning cash, struggling with production problems,
and hedge funds were betting it would fail. The car executives are
not laughing anymore. Almost overnight, the Tesla Model 3 has
become one of the best-selling cars in Europe. In December, only
the Volkswagen Golf and Renault Clio sold more, according to data
compiled by JATO Dynamics, a market research firm.”
Recognizing the EV wave of the future, Toyota Motor
Corporation (NYSE: TM) recently announced plans to partner
with First Automobile Works (FAW) to build an electric vehicle
plant in Tianjin, China (http://nnw.fm/i9cHu). The two companies will invest
about $1.22 billion in the plant, which is expected to produce
200,000 battery-only, plug-in hybrid and fuel-cell vehicles
annually. This news follows the launch of care maker’s C-HR and
IZOA models, the first battery-electric vehicles to launch in China
under the Toyota brand.
Toyota is also partnering with Panasonic Corp.
ADR (OTC: PCRFY) to establish Prime
Planet Energy & Solutions Inc., a joint venture specializing in
automotive prismatic batteries (http://nnw.fm/buM6E). The joint venture will focus on
developing highly competitive, cost-effective batteries that offer
excellent quality and performance in terms of capacity, output and
durability. The joint venture will supply batteries not only to
Toyota but also to all customers.
With the demand for electric vehicles increasing significantly,
mineral producers are seizing the opportunities found in a growing
battery industry.
For more information on Pacific Rim Cobalt Corp., visit Pacific Rim
Cobalt Corp. (CSE:BOLT) (OTCQB:PCRCF) (XFRA:NXFE)
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