Dear Reader,
Last week, council members and administrators of Morgan County, Georgia, got a surprising piece of news delivered to them as electric truck-maker Rivian announced plans for the construction of a rechargeable battery plant as part of an existing megafactory project to be located in Stanton Springs North.
The project, which will bring up to 3,000 additional jobs to the area, had never been proposed to the county commission, causing a stir among the policymakers.
“This creates great concern for me,” commented Morgan County Commissioner Chairman Ben Riden. “If Rivian is going to be dealing with raw lithium and manufacturing batteries, that is not how it was ever explained to me.”
Rivian, to those who haven’t taken note of its gradually growing presence on the roads, is a niche EV-maker and one of the only other American EV-only manufacturers that poses any sort of threat to Tesla’s dominance of the space.
That's because Rivian only makes the types of vehicles North Americans prefer above all others: trucks and SUVs, and the company has been competing successfully against the likes of Ford, Chevy, and GMC since delivering its first unit in September 2021. Our analysts have traveled the world over, dedicated to finding the best and most profitable investments in the global energy markets. All you have to do to join our Energy and Capital investment community is sign up for the daily newsletter below.
Even after massive turmoil on the open market, Rivian remains a substantial company, with a market capitalization of $18 billion and an annual production rate of 52,000 vehicles projected for next year.
The Biggest Hurdle for Electric Vehicle Makers Today
Still, despite Rivian's size and growing reputation, moves like this one tell a common tale of woe within the EV sector.
The somewhat surreptitious addition of a battery plant to the already massive $5 billion project underscores the single biggest logistical weakness for the EV industry — battery production.
Costly, environmentally taxing, and reliant on a constant flow of increasingly scarce raw materials, battery production is quickly becoming the 21st-century equivalent of oil refinement.
While cost can be justified and overcome and environmental issues can be dealt with through diligence and strict adherence, the one problem that the EV industry and the consumer tech industry cannot simply power their way through is the world’s deficient supply of raw materials — particularly lithium itself.
As of this year, we’ve crossed an invisible threshold that should have every man, woman, and child living in the developed world at least as concerned as they are over climate change or inflation… the gap between lithium supply and lithium demand.
This isn’t just another chart showing another trend.
This is a road map to global cataclysm as our way of life, our way of sharing information, and our way of moving goods and people has become utterly dependent on an element we simply do not have enough of.
Can the McDermitt Caldera Save Us?
You may have heard about the recent discovery of between 20 million and 40 million tons of lithium at the McDermitt Caldera on the Nevada/Oregon border.
It's the biggest discovery ever by a wide margin.
If we’re lucky, it could single-handedly double known global lithium reserves.
The problem is that like all prospective lithium mining operations, it’s going to take at least 10 years to get things going at the site.
That's 10 years of groundwork, preparation, and getting all the infrastructure in place, and that’s if and only if a brewing legal conflict with Native American groups, which have made legal claim to the area as a sacred burial ground, can be resolved.
Ten years of a widening gap between what we need and what we have.
Ten years of the U.S. controlling just barely 2% of the global lithium supply.
Companies like Rivian need an abundant source of lithium sourced someplace close.
Without it, you can forget all of those misty images of the future you may have been harboring in your mind because it’s not going to happen.
Chances Are You've Never Heard of Today's Most Prospective Lithium Pure Play
Thankfully, there's a solution to the problem, and it’s coming to us from our friends up north.
Based in Calgary, Alberta, a technology company headed up by veterans of the petrochemical industry has found a way to produce lithium from standard, basic oil field brines.
It’s important to repeat that this is a technology company, not a miner. Its technology makes it possible for most any oil and gas operation to painlessly diversify into lithium production with the simple installation of a filtration facility on site.
The company is currently operating on a 671-square-mile oil and gas property in the northwestern corner of the province and is getting ready to go into commercial production next summer.
The system is so simple and sidesteps so many of the biggest time-wasters associated with traditional lithium production that it could potentially revolutionize the industry entirely.
There’s no searching. No test drilling. No geological surveys and ground-penetrating radar maps.
When dealing with oil field brine ponds, the location of the lithium is known; the concentration of lithium within the solution is established. For anybody who knows how to filter the solution properly, lithium extraction is a simple matter of hooking into the brine flow, passing it through the filtration facility, and returning it to the pond for continued use.
Lithium can be shipping from the site within weeks, not years.
Sitting at the Intersection of Two Major Industrial Forces
EV-makers like Rivian need the lithium, and oil- and gas-producing giants will be chomping at the bit to diversify their interests into one of today’s fastest growing markets.
It’s the ideal place for a young, small, focused company to be.
How small? That’s the best part.
It’s barely a blip on the radar today at just a $25 million market capitalization. At the very barest of annual production rates, which the company expects to achieve by the middle of next year, that figure could easily breach the $100 million mark.
At 20,000 tons of annual production, which is feasible within the next few years, that figure jumps into the billions.
I know these projections sound wild, and it’s true, growth like this is a rarity, but it can and does happen when highly disruptive technologies impact already-well-established trends.
You probably have questions… I know I did when I first heard of the company a few months back.
To get those questions answered and to get the full picture on just how big of an opportunity this represents, I urge you to check out my video presentation on the subject.
It’s fast and easy to understand, and when it’s finished, you’ll have all the details you need to make an informed decision.
Access is instant and registration free but only for a limited time.
Fortune favors the bold, Alex Koyfman His flagship service, Microcap Insider, provides market-beating insights into some of the fastest moving, highest profit-potential companies available for public trading on the U.S. and Canadian exchanges. With more than 5 years of track record to back it up, Microcap Insider is the choice for the growth-minded investor. Alex contributes his thoughts and insights regularly to Energy and Capital. To learn more about Alex, click here.
Check us out on YouTube!
