Lithium Exploration Group CEO Discusses Lithium Markets
March 27 2014 - 8:45AM
Marketwired
Lithium Exploration Group CEO Discusses Lithium Markets
SCOTTSDALE, AZ--(Marketwired - Mar 27, 2014) - Lithium
Exploration Group Inc. (OTCQB: LEXG) CEO Alex Walsh discusses the
recent activity and commentary around the lithium industry:
There have been a number of articles written in recent weeks
about the lithium industry and I have personally received a huge
influx of calls from shareholders and interested parties trying to
get a handle on what is going on out there. I want to take a
moment to answer some questions and comment on what is being
reported in the media.
- Tesla - Tesla's gigafactory concept is brilliant. It
vertically integrates their operations, allowing for the Tesla
brand to expand while controlling unnecessary third party costs and
expenses in the supply chain.
- Supply and Demand Discussion
- Historically, lithium prices more than tripled over the 10-year
period from 2000 to 2010. That demand was driven by iPods,
cell phones, tablets, and laptops. There is roughly a two-year
production cycle in the solar evaporation process to produce
lithium from brine (which makes up a majority of the global supply
of lithium) so, as demand increased, supply could not meet those
needs, spawning huge spot price fluctuations.
- Prices have stabilized in recent years near $6,000/ton but
there have been reports of oversupply recently holding prices
steady even though electric vehicles have continued to grow in
popularity. I expect that this will change rapidly -- perhaps
more rapidly than people can quantify -- because the amount of
lithium needed in a car battery is one hundred times the amount
required for a laptop computer or a tablet. Supply needs must
be initiated now to meet the 2017 goal of Tesla, and I believe that
Tesla will begin to acquire as much lithium supply as it can get
its hands on in North America to further the vertical integration
of the electric vehicle production and insulate it from price
volatility.
- When will that happen?
- Only Elon Musk and his advisory team know for sure when this
will happen, but it is not going to be an overnight
decision. As they have with their expansion into the market,
they will certainly look at all options, but I am confident that
they will buy the lithium they need to run this
gigafactory. SQM (Chile) is the largest producer of lithium in
the world (and owned by Potash Corp of Saskatchewan). Tesla
could easily acquire SQM and ensure their supply for decades to
come.
- What does this mean for the rest of the global market?
- Strap on your seatbelts because there will be a frenzy of
activity all over the globe trying to replace the 10,000 - 15,000
tons of lithium carbonate that Tesla will be consuming.
- What does this mean for Lithium Exploration Group?
- I think that, at the end of the day, we have a separation
technique designed to target lithium chloride and produce lithium
carbonate, a 43-101 and hydrogeological study complete on the
region and aquifer we are trying to target, and a technology that
we hope will speed up the brine evaporation process from months to
minutes.
- I don't know if Tesla will look to buy our knowledge,
technology rights, our team, or our production but I do know that
what they are doing to drive demand and visibility to the lithium
exploration market will be good for us either way.
I was going to address some of these things in my April Letter
to Shareholders but felt that some of these things should be shared
more immediately in response to enquiries.
Sincerely, Alex Walsh CEO Lithium Exploration Group, Inc.
About Lithium Exploration Group Lithium Exploration Group is a
US-based exploration and development company focused on the
acquisition and development potential of lithium brines and other
precious metals that demonstrate high probability for near-term
production. Currently the company is focused on its Western Canada
lithium assets, testing its Ultrasonic Generator Technology and the
acquisition of oil and gas related assets in Western Canada.
Lithium Exploration Group is a fully reporting company traded on
the OTCQB under the symbol LEXG. Website:
www.lithiumexplorationgroup.com.
Safe Harbor Statement This news release contains
"forward-looking statements." Statements in this press release that
are not purely historical are forward-looking statements and
include any statements regarding beliefs, plans, expectations or
intentions regarding the future testing of the ultrasonic
technology.
Actual results could differ from those projected in any
forward-looking statements due to numerous factors. Such factors
include, among others, the inherent uncertainties associated with
mineral exploration and difficulties associated with obtaining
financing on acceptable terms. We are not in control of lithium
prices and these could vary to make development uneconomic. These
forward-looking statements are made as of the date of this news
release, and we assume no obligation to update the forward-looking
statements, or to update the reasons why actual results could
differ from those projected in the forward-looking statements.
Although we believe that the beliefs, plans, expectations and
intentions contained in this press release are reasonable, there
can be no assurance that such beliefs, plans, expectations or
intentions will prove to be accurate. Investors should consult all
of the information set forth herein and should also refer to the
risk factors disclosure outlined in our most recent annual report
for our last fiscal year, our quarterly reports, and other periodic
reports filed from time-to-time with the Securities and Exchange
Commission.
CONTACT: Shanon Chilson 480-641-4790
info@lithiumexplorationgroup.com