FN Media Group Presents Oilprice.com Market Commentary
LONDON, Aug. 23, 2023 /PRNewswire/ -- The EV industry faces a huge challenge of replacing, in record speed, internal combustion engines (ICE) that have ruled the roads for over a century—and domesticating the entire supply chain to meet the demands of an electric vehicle industry quickly closing in on a trillion-dollar market value. So far, it's all been done backwards, which is how many revolutionary ideas unfold … Companies mentioned in this release include: Tesla, Inc. (NASDAQ:TSLA), QuantumScape Corporation (NYSE:QS), NIO Inc. (NYSE:NIO), EnerSys (NYSE:ENS), Teck Resources Limited (NYSE:TECK).
North America is building EV factories first, then battery gigafactories. Only after these grand plans has enough attention been given to mineral processing. And coming in last, is mining of those critical minerals necessary to make it all happen.
This is the necessary reality. Investors saw what happened to lithium mining when it attempted to surge ahead into its proper place: The market wasn't ready for supply to catch up with future demand, but lithium miners fought on. Now, it's graphite's turn.
Graphite makes up 95-99% of the anode (negative electrode) material in lithium-ion batteries, making it the largest component in any EV battery. Once you get past the lithium hype, quiet graphite is the most critical element here. A 'lithium-ion' battery can contain 15X more graphite than lithium, and make up some 25% of a battery's total volume, leading Tesla's Elon Musk to state that they should, effectively, be called 'nickel-graphite batteries'.
Now, with EV demand explosive and the industry on track to grow another 35% this year, we need experienced operators who can feed the battery gigafactories with refined graphite.
For North America, which has zero commercial production of refined graphite, that advantage goes to Graphex Group Ltd (GRFX), led by John DeMaio, who has 35 years of experience in the energy and infrastructure sectors, including as former President, CEO and Board Member of JouleSmart Solutions, general manager of Siemens Smart Infrastructure, VP of MWH Global, VP of SPG Solar and COO of Thompson Solar Technologies.
In an effort to domesticate the graphite supply chain for North America's gigafactories, Graphex Group is building a 15,000 tons-per-annum graphite refining facility in the heart of America's auto industry—Detroit—with construction and first production expected in late 2024, subject to typical construction schedule impacts.
Importantly for investors and for North America's future supply chain, Graphex Group isn't a new player in this game. It already produces 10,000 tons-per-annum of refined graphite in Asia. Now, it's bringing its technology and expertise home in a first for North America.
Refining graphite is a tricky business, and there is no commercial graphite refining in North America--yet. But Graphex Group has mastered the process. While potential competitors are still in the pilot or lab stage of production, Graphex Group is already commercial and can produce to scale. It's ready to plug and play and feed the Gigafactory demand.
And that timing is now critical, given the massive amount of battery production planned in North America.
Supply Deals De-Risk North America's First Domestically Refined Graphite
Outside of China, few graphite mines are producing significant quantities. Even fewer are doing any refining—the most profitable aspect of the graphite supply chain--for the EV industry.
To bring graphite refining home to North America, it is necessary to secure enough raw material, and to avoid regulatory complications and non-compliance with the Inflation Reduction Act (IRA), that raw material should come from outside of China. This is the greatest challenge for a North American domestic graphite supply; but Graphex Group appears to have met the challenge.
In December, Graphex Group (GRFX), entered into a non-binding LOI (letter of intent) with Northern Graphite Corporation (NGC) to aggregate NCG's raw material supply capabilities with Graphex's proven downstream processing expertise to narrow the supply-demand gap for North America.
That agreement preceded a much bigger one in January this year that saw Graphex Group and Northern Graphite join forces on the construction of a large-scale graphite processing facility in Quebec's Baie-Comeau region. The partners are now evaluating sites to house a facility that could produce up to 200,000 tons of graphite annually.
Also in December, Graphex Technologies (a wholly-owned subsidiary of Graphex Group) signed an MOU with private mining outfit Reforme Group Pty Ltd to provide raw materials for Graphex's Michigan facility. Again, in January, Graphex announced an LOI with Ontario-based Gratomic Inc for more raw supplies.
But the biggest deal yet came on August 1, when Graphex Technologies signed an agreement with Syrah Resources' Balama graphite operation in Mozambique, further diversifying the raw materials supply chain. Syrah's Balama graphite operation is the largest in existence outside of China, with a production capacity of 350,000 metric tons per year.
The significance of this most recent deal is that it adds the final de-risking element for Graphex Group's raw material supply question—and without any reliance on China.
"The agreement with Syrah could change the graphite game in North America," DeMaio said in a statement on August 1. "Connecting Syrah's volume without proven experience and ongoing build-out of domestic processing capacity in North America represents a giant leap forward in meeting the demand for high-quality, high-volume, US IRA-compliant graphite anode material in the EV and renewable energy industries," he said.
Graphite, at A Critical Moment
Graphite is a $23-billion industry and represents one of the biggest opportunities in the huge investment arena of batteries, the backbone of an everything-electric future. In less than a decade, graphite will be worth an estimated $43 billion.
Despite the fact that North American battery factories represent some 1 million metric tons per year of demand for graphite anode material, there is no commercial production in North America.
Graphex Group (GRFX), is operating in the most profitable area of the graphite supply chain—refining—and its first North American plant is being built and is expected to start operations next year.
In creating a domestic supply chain for graphite in North America, Graphex is poised to take on market share because of its expertise, its ability to transfer its proven technology here for commercial production. This isn't a pilot project. Already producing 10,000 tons per annum, Graphex is currently implementing a large-scale expansion to increase production to 20,000 tons per annum.
Because China dominates the graphite supply chain, North America is looking for a foothold that will allow it to secure its own supply. Most companies larger than Graphex by production volume are Chinese, giving Graphex a clear advantage in a space dictated both by the challenge of supply meeting demand and by geopolitics.
With a decade of graphite refining experience already behind it, and with the need for flake graphite set to reach 4.1 million tons per year by 2030, North America is looking to Graphex to replicate its full-scale commercial processes first in Michigan by next year, and then in Quebec—and beyond.
The Battery Industry Is Booming
Few companies have heralded the electric future quite like Tesla, Inc. (NASDAQ:TSLA). Headed by the enigmatic Elon Musk, Tesla is more than just electric vehicles. It's about reimagining transportation through innovation and unparalleled battery tech. Their Gigafactories aren't just manufacturing units; they're global symbols of Tesla's ambition to lead the EV and energy storage revolution.
Tesla's in-house battery cells, known for their range and durability, have not just powered their vehicles but have sparked a shift in automotive industry standards. From the Roadster to the Cybertruck, Tesla's vehicles boast unmatched battery lifespans and power capabilities.
QuantumScape Corporation (NYSE:QS) is not just another name in the EV space; it's a beacon of next-generation solid-state battery technology. Shattering the constraints of traditional lithium-ion batteries, QuantumScape is pioneering batteries that promise faster charge times and a longer lifespan.
Their solid-state design replaces liquid electrolytes, unlocking higher energy densities and bringing forth a safer and more efficient battery. It's not about incremental changes but transformative leaps in battery innovation.
NIO Inc. (NYSE:NIO) isn't just a car brand; it's a symbol of Chinese prowess in the EV race. Their vehicles are sleek, smart, and, most importantly, backed by battery tech that aims to alleviate range woes and long charging downtimes.
NIO's Battery as a Service (BaaS) is groundbreaking. Instead of buying an EV with a battery, consumers lease the battery, swapping it out when depleted. This not only reduces the EV's cost but also ensures the vehicle is always powered by the latest battery tech.
Beyond the consumer eye, EnerSys (NYSE:ENS) powers industries with robust battery solutions. Their offerings aren't limited to one domain; they span from telecom to aerospace, showcasing versatility. With a focus on innovation, EnerSys doesn't just create batteries; they redefine energy storage possibilities.
Their portfolio includes lithium batteries tailored for specific industry needs, ensuring performance isn't compromised. EnerSys's vision isn't just to provide energy but to ensure it's consistent, reliable, and efficient.
Teck Resources Limited (NYSE:TECK) is one of the most diversified miners out there. Their portfolio, ranging from copper to zinc, is a testament to adaptability in an ever-evolving market.
Their significant stake in the Fort Hills oil sands project might raise eyebrows, but their sustainable initiatives, such as the 'RACE21' program, underscore a commitment to responsible extraction. With Teck, it's about unearthing potential without compromising the planet.
By. Tom Kool
IMPORTANT NOTICE AND DISCLAIMER
Neither the author nor the publisher, Oilprice.com, was paid to publish this communication concerning Graphex Group. The owner of Oilprice.com owns shares and/or stock options of the featured company and therefore has an incentive to see the featured company's stock perform well. The owner of Oilprice.com has no present intention to sell any of the issuer's securities in the near future but does not undertake any obligation to notify the market when it decides to buy or sell shares of the issuer in the market. This share ownership should be viewed as a major conflict with our ability to be unbiased. This is why we stress that you conduct extensive due diligence as well as seek the advice of your financial advisor or a registered broker-dealer before investing in any securities.
Readers should beware that third parties, profiled companies, and/or their affiliates may liquidate shares of the profiled companies at any time, including at or near the time you receive this communication, which has the potential to hurt share prices. Frequently companies profiled in our articles experience a large increase in volume and share price during the course of investor awareness marketing, which often ends as soon as the investor awareness marketing ceases. The investor awareness marketing may be as brief as one day, after which a large decrease in volume and share price may likely occur.
This communication is not, and should not be construed to be, an offer to sell or a solicitation of an offer to buy any security. Neither this communication nor the Publisher purport to provide a complete analysis of any company or its financial position. The Publisher is not, and does not purport to be, a broker-dealer or registered investment adviser. This communication is not, and should not be construed to be, personalized investment advice directed to or appropriate for any particular investor. Any investment should be made only after consulting a professional investment advisor and only after reviewing the financial statements and other pertinent corporate information about the company. Further, readers are advised to read and carefully consider the Risk Factors identified and discussed in the advertised company's SEC, SEDAR and/or other government filings. Investing in securities, particularly microcap securities, is speculative and carries a high degree of risk. Past performance does not guarantee future results. This communication is based on information generally available to the public and does not contain any material, non-public information. The information on which it is based is believed to be reliable. Nevertheless, the Publisher cannot guarantee the accuracy or completeness of the information.
FORWARD LOOKING STATEMENTS. This publication contains forward-looking statements, including statements regarding expected continual growth of the featured companies and/or industry. The Publisher notes that statements contained herein that look forward in time, which include everything other than historical information, involve risks and uncertainties that may affect the companies' actual results of operations. Factors that could cause actual results to differ include, but are not limited to, changing governmental laws and policies, success of the companies graphite production operations, the continuation and success of the companies' joint ventures; the size and growth of the market for the companies' products and services, the companies' ability to fund its capital requirements in the near term and long term, pricing pressures, etc.
INDEMNIFICATION/RELEASE OF LIABILITY. By reading this communication, you acknowledge that you have read and understand this disclaimer, and further that to the greatest extent permitted under law, you release the Publisher, its affiliates, assigns and successors from any and all liability, damages, and injury from this communication. You further warrant that you are solely responsible for any financial outcome that may come from your investment decisions.
TERMS OF USE. By reading this communication you agree that you have reviewed and fully agree to the Terms of Use found here http://oilprice.com/terms-and-conditions If you do not agree to the Terms of Use http://oilprice.com/terms-and-conditions, please contact Oilprice.com to discontinue receiving future communications.
INTELLECTUAL PROPERTY. Oilprice.com is the Publisher's trademark. All other trademarks used in this communication are the property of their respective trademark holders. The Publisher is not affiliated, connected, or associated with, and is not sponsored, approved, or originated by, the trademark holders unless otherwise stated. No claim is made by the Publisher to any rights in any third-party trademarks.
DISCLAIMER: OilPrice.com is Source of all content listed above. FN Media Group, LLC (FNM), is a third party publisher and news dissemination service provider, which disseminates electronic information through multiple online media channels. FNM is NOT affiliated in any manner with OilPrice.com or any company mentioned herein. The commentary, views and opinions expressed in this release by OilPrice.com are solely those of OilPrice.com and are not shared by and do not reflect in any manner the views or opinions of FNM. FNM is not liable for any investment decisions by its readers or subscribers. FNM and its affiliated companies are a news dissemination and financial marketing solutions provider and are NOT a registered broker/dealer/analyst/adviser, holds no investment licenses and may NOT sell, offer to sell or offer to buy any security. FNM was not compensated by any public company mentioned herein to disseminate this press release.
FNM HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.
This release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. "Forward-looking statements" describe future expectations, plans, results, or strategies and are generally preceded by words such as "may", "future", "plan" or "planned", "will" or "should", "expected," "anticipates", "draft", "eventually" or "projected". You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company's annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and FNM undertakes no obligation to update such statements.
Contact Information:
Media Contact e-mail: editor@financialnewsmedia.com
U.S. Phone: +1(954)345-0611
View original content:https://www.prnewswire.co.uk/news-releases/graphite-wars-the-trillion-dollar-battery-race-has-a-big-problem-301907566.html
Voltar noticias em Inglês