US Lithium to mine for copper, nickel, cobalt in Canada's Saskatchewan
Shares in US Lithium (OTCMKTS:LITH) went ballistic Friday after the exploration firm announced it had acquired a copper, nickel, cobalt project in Canada's Saskatchewan.
Demand for lithium and cobalt has increased significantly in the past two years thanks to the growing production of electric and hybrid cars that use them in their batteries and other components.The Gochagar Lake project, until now property of Diamond Hunter, consists of four claims covering 3,759 hectares located in northern Saskatchewan approximately 75 km north of the town of La Ronge, the Nevada-based company said.
Other than copper, expected to be the best performing commodity this year, the area is know for having semi-massive and massive Ni-Cu deposits with significantly elevated levels of cobalt, a vital component in the manufacture of the latest generation of lithium ion batteries.
"With over 50% of the world's cobalt currently supplied from the conflict-stricken Democratic Republic of the Congo, we welcome the opportunity to explore for this critical mineral in the mining friendly jurisdiction of Saskatchewan," the company's chief executive Greg Rotelli said in the statement.
Demand for lithium and cobalt has increased significantly in the past two years thanks to the growing production of electric and hybrid cars that use those elements in their batteries and other components. Mobile phones, computers, glass, ceramics, lubricant greases, polymers and drugs are among other products that use those metals.
Speculators hoping to profit from the raising appetite for cobalt and lithium expect demand for electric cars to surpass market expectations, pushing the price of those metals to new highs. Cobalt, in particular, has benefitted from the growing demand, and it's currently trading at about $21 a pound, more than 50% higher than its November value.
Meanwhile battery makers such as Panasonic, which makes battery cells for Tesla, are rushing to lock-up supplies of the scarce metal, FT.com reports (subs. required).
US Lithium stock was up almost 42% to 0.0640 on the news at 10:16 am ET.