October 2, 2018 – Eric Vengroff, Financial Analyst, Graphite Daily
Notwithstanding the cancellation of the rebates for electric vehicles in Ontario, Canada, and the very public trials and tribulations of Tesla and its colorful CEO growth in sales of electric and hybrid electric vehicles is likely here to stay.
As the costs of production decrease and approach the cost of internal combustion vehicles, sales will rise organically, if not by government-led climate change mitigation policy.
In any case, the demand for lithium ion batteries, and the components that make them up is rising.
The rise of things powered by portable, rechargeable lithium-ion battery cells continues unabated. Mobile phones and portable computers of all manner and description employ these power sources. Automotive and other applications typically contain about 1 kg of graphite per Kwh of battery capacity. Approximately half the weight of a battery consists of the anode, or positive side of the battery. Automotive and other applications typically contain about 1 kg of graphite per Kwh of battery capacity. In a cellphone, that represents a few grams of graphite.
The battery pack for the Tesla, by comparison, contains about 85 kg of graphite. When you add up the number of other car companies that are building or are about to build fully-electric, battery-powered vehicles, that’s even more graphite. Where’s it all coming from?
Graphite currently has two major sources in the world. Natural flake graphite, mined in countries around the world, or synthetic graphite, which is usually made from petroleum coke.
According to an article written by jaberwock, published by Seekingalpha.com, battery makers for high-end automotive applications use synthetic graphite because of variations in quality and restrictions on supply of natural graphite, most of which is produced by small-scale mining operations in China. China also produces 100% of the world’s spherical graphite used in lithium ion batteries.
In this same article, he selected a forecast made by AVICENNE Energy at a conference in Montreux in September 2015.
The red bars, representing the growth in lithium ion for electric vehicles, shows dramatic increases over the next few years.
At present, China produces 100% of the world’s spherical graphite.
I look at this unrelenting need in light of the recent announcements by Ceylon Graphite (a) certifying that graphite obtained from its K1 site is upgradeable and meets the specifications of marketable battery grade graphite, (b) the September 12 announcement that the assay test results of samples from the large untapped natural graphite vein discovered in late August 2018 at its K1 site in the Karasnagala area and tested at the laboratory of the Sri Lanka Government’s Geological Survey and Mines Bureau showing 97.61% pure carbon, and the announcement today there are 13,000 tonnes of 80%+ carbon graphite contained in one location, and the company has 100 more grids yet to explore.
This one area and this company may play a material role in increasing global graphite supply for batteries and keeping the cost of electronic technology in cars or phones, affordable and available.
When starting with higher grade graphite, it makes the subsequent downstream upgrading and refining processes less capital-intensive and lowers the cost of creating battery-grade material. Although this will have to be substantiated by the numbers when the facility goes into production, the higher quality mineral will effectively lower cost/tonne of extraction and more than make up for any higher costs of transportation. Graphite from this area of Sri Lanka may still be the shortest distance between the mineral and battery.
Here’s the most recent news headlines from CYL, so you can make an educated investment decision… and see why baystreet.ca today called them “a stock in play”
– 10/2/2018 – 10:21 AM EST – Ceylon Graphite Corp. : Has filed a technical report for the Malsipura Graphite Project. The Technical Report was prepared in accordance with the requirements of National Instrument 43-101- Standards of Disclosure for Mineral Projects. Ceylon Graphite Corp., – See ‘Malsipura Project’ headline below.