Stockhead’s High Voltage: A lithium-ion battery is a terrible thing to waste

As electric vehicle uptake supercharges, there will be a scramble for key metals and elements. So burying old batteries makes no sense. Enter, the recycling industry.

The last thing we're going to want to do is bury old batteries. Picture: Getty Images

Our High Voltage column wraps all the news driving ASX stocks with exposure to lithium, cobalt, graphite, nickel, rare earths, manganese, magnesium, and vanadium.

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Google the phrase ‘battery metals shortage’ and something becomes clear – metals/elements such as lithium, cobalt, rare earths, and nickel are already facing supply chain constraints and the EV sector is barely warming up.

We’re in trouble, experts say.

EVs require roughly six times more minerals than cars with internal combustion engines, according to S&P Global.

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That could see lithium demand increase by more than 40 times in the next two decades.

Meanwhile, graphite, cobalt and nickel demand could climb by 20 to 25 times if the world meets the climate targets set by the Paris Agreement on climate change, according to the International Energy Agency.

There are several potential solutions besides building more mines, quicker (which probs won’t happen), like tech innovation to thrift raw materials, new battery chemistries (like sodium-ion), undersea mining, and recycling.

In an interview with Argus, France’s Veolia head of EV battery recycling, Emeric Malefant, says recycling will be crucial to the EV revolution for three main reasons.

Firstly, batteries are one of the major contributors to the environmental footprint of EVs.

“Recycling is a key benefit to drastically reducing this footprint and reaping the full benefits of decarbonising electric mobility,” Malefant says.

Also, long-term, resource supply may become an issue in some territories, depending on geopolitical fluctuations.

“Developing recycling programs can reduce our dependence by increasing self-sufficiency in strategic metals such as lithium, nickel and cobalt,” Malefant says.

And finally, batteries can be a threat to the environment and the people who handle them, as they contain chemicals and are highly flammable.

“Proper management of their recycling is therefore mandatory to avoid accidents and mitigate any form of risk,” Malefant says.

It’s not just Veolia either. All the big boys are into it, and the recycling plants being proposed are only getting bigger and bigger.

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ASX battery recycling stock

There are already ASX stocks looking to build battery recycling businesses.

The frontrunner here is Neometals (ASX:NMT) which reinvented itself as a battery recycling stock after selling out of its minority stake in the Mt Marion mine a few years ago.

In March, the company’s battery recycling JV, Primobius, officially opened its 10tpd commercial lithium-ion battery (LIB) recycling plant in Germany. It is expected to start operation soon.

In May, it executed a co-operation agreement with iconic German carmaker Mercedes-Benz’ recycling subsidiary LICULAR.

Meanwhile, an investment decision for its first 50tpd operation with Stelco in Canada is expected in the September Quarter of 2022.

Other ASX stocks coming at the recycling thematic from different angles include Hannans (ASX:HNR) (part owned by NMT) and Lithium Australia (ASX:LIT).

It’s been a better week for battery metals stocks on the ASX, with 90 up, 98 down, and 34 unchanged.

Weekly Small Cap Standouts

FLYNN GOLD (ASX:FG1)

FG1 hit the boards last year with a focus on underexplored northeast Tassie, where the company believes there are ‘Fosterville-style’ gold deposits to be found.

In early 2022, it also picked up some gold-lithium project tenements in WA.

The 1232sqkm lithium-gold portfolio is near the world class Pilgangoora, Wodgina, Mt Holland and Mt Cattlin lithium deposits.

‘Mt Dove’ in the Pilbara includes multiple gold-lithium targets located just 11km from the 6.8Moz Hemi gold project and along strike from Kairos’ Kangan gold-lithium target.

On-ground exploration was to commence at Mt Dove in May/June 2022, FG1 says.

FG1 also has plans to further increase the size and quality of its lithium-gold portfolio in 2022.

ODESSA MINERALS (ASX:ODE)

In April, this diamond explorer branched out into lithium and rare earths, acquiring the 606sqkm ‘Lyndon’ project near Carnarvon in WA.

The project includes numerous clusters of pegmatites prospective for lithium, and several features similar to those associated with Dreadnought’s (ASX:DRE) nearby rare earth discoveries.

“This Lyndon project acquisition is an excellent opportunity for Odessa to enter the battery metals sector, in a part of the Gascoyne Complex that is host to a number of newly discovered occurrences of lithium, rare earth and nickel-copper,” ODE CEO Alistair Stephens said April.

“We remain resolutely focused on progressing our cornerstone diamond projects in the Kimberley region, and as work becomes limited during the northern wet season, this acquisition will provide an excellent year-round exploration project for Odessa.”

PANTHER METALS (ASX:PNT) 

WA-based PNT, a subsidiary of London-listed Panther Metals PLC, listed in December after a $5m IPO.

Maiden drilling soon kicked off at the ‘Coglia’ nickel-cobalt project, where a JORC exploration target of 30-50 million tonnes at 0.6-0.8% nickel and 400-600 parts per million cobalt was already defined by previous explorers.

It has not only delivered a much bigger-than-expected maiden mineral resource (MRE), but it has done even better than its promised IPO schedule, bringing it in before the “second half of 2022” target laid out in the IPO.

The maiden MRE has come in 40% larger at 70.6Mt at grades of 0.7% nickel and 460 parts per million (ppm) cobalt for 476,000t of nickel and 32,200t of cobalt.

The project is strategically located 70km east by road from Glencore’s hungry nickel and cobalt plant, which provides a potential processing option.

This content first appeared on stockhead.com.au

At Stockhead we tell it like it is. While Panther Metals is a Stockhead advertiser, it did not sponsor this article.

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