{"id":78389,"date":"2015-09-17T07:31:27","date_gmt":"2015-09-17T11:31:27","guid":{"rendered":"http:\/\/countingpips.com\/?p=78389"},"modified":"2015-09-17T07:31:27","modified_gmt":"2015-09-17T11:31:27","slug":"pure-energy-minerals-drops-the-next-lithium-bombshell","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2015\/09\/pure-energy-minerals-drops-the-next-lithium-bombshell\/","title":{"rendered":"Pure Energy Minerals Drops the Next Lithium Bombshell"},"content":{"rendered":"
September 17, 2015<\/div>
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By Peter Epstein, CFA, MBA \u00a0\u00a0http:\/\/EpsteinResearch.com<\/a><\/strong><\/p>\n

On Wednesday, September 16th, Nevada\u2019s\u00a0Pure Energy Minerals (PE.V) \/ (HMGLF) & (AHG1.DE<\/a>)\u00a0<\/strong>announced the signing of an agreement with\u00a0Tesla Motors Inc. (TSLA)<\/strong>.\u00a0<\/strong>To say that this is blockbuster news\u00a0for the Company would be the\u00a0understatement of the decade and in fact might not even suffice.\u00a0Each agreement between Tesla and a junior company is unique. For the avoidance of doubt, here\u2019s key parts, of the\u00a0press release<\/u><\/strong>, quote, (modestly shortened by me<\/em>).<\/p>\n

\u201c\u2026the Company has entered into an agreement with\u00a0Tesla Motors Inc<\/strong>. for the potential supply of lithium hydroxide that\u00a0Pure Energy<\/strong>\u00a0Minerals<\/strong>\u00a0plans to produce from the Company\u2019s\u00a0Clayton Valley, Nevada Lithium Brine Project<\/strong>. Pure Energy will conduct mining studies in the forms of,\u00a0Preliminary Economic Assessment, Pre-Feasibility Study\u00a0OR<\/strong>\u00a0Feasibility Stud<\/u>y to confirm the technical and economic viability of the Project.\u201d\u00a0<\/em><\/p>\n

The press\u00a0<\/em>continues, quote, (modestly shortened by me)<\/em><\/em><\/p>\n

\u201cProvided that Pure Energy meets terms and conditions related to project\u2019s quality and timing of delivery, the Agreement establishes a commitment for annual purchase volume over 5 years by Tesla and\/or its authorized purchasers. The Agreement sets a\u00a0pre-determined price<\/u>\u00a0that is below current market rates and aligned with Tesla\u2019s goal to reduce the cost of its lithium ion batteries. The supplied lithium will be used in the battery cell manufacturing process of Tesla\u2019s rapidly growing electric vehicle and stationary storage units. Any deliveries from Pure Energy will cover a portion of Tesla\u2019s needs with the remainder to come from other sources.\u201d<\/em><\/p>\n

Robert Mintak, Pure Energy CEO, commented<\/strong>,<\/p>

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\u201cThis agreement with Tesla is a significant milestone that validates Pure Energy\u2019s lithium brine project and business development model, and is an important step in the development of the Project.\u00a0Pure Energy is aligned with both Tesla\u2019s and the State of Nevada\u2019s development objectives, and we hope to positively contribute to Nevada\u2019s booming clean energy based economy.\u201d<\/em><\/p>\n

This agreement represents much more than merely a potential off-take partnership. This is a\u00a0HUGE<\/strong>\u00a0vote of confidence for Pure Energy Minerals, its shareholders, future investors, (including new looks from institutions<\/em>) and prospective strategic partners. Consider the relative ease Pure Energy will now have with this Tesla news in their back pocket. Consider the relative ease for Pure Energy to obtain financing when that need arises. Consider the ability of the Company to move rapidly with Nevada State officials on permits and approvals. For these reasons and more, this single press release is worth more than any other news possible.<\/p>\n

As an aside,\u00a0Bacanora Minerals Ltd\u2019s\u00a0<\/strong>stock was up 55% in subsequent days from 65 pence to an intra-day high of 100 pence upon its \u00a0announced lithium supply agreement with Tesla.<\/p>\n

Stepping back for a moment, on\u00a0<\/strong>September 3rd,\u00a0<\/strong>Tesla\u2019s Founder\u00a0Elon Musk<\/strong>\u00a0reiterated his commitment to source materials from Nevada. However, that pledge did not necessarily mean another sourcing deal, announced so soon, or that it would be for lithium. Other materials besides lithium will be required. Cobalt and graphite, (among others<\/em>), will also be needed\u00a0to feed Tesla\u2019s massive\u00a0giga-factory in Nevada<\/u><\/strong>. I find this agreement to be highly noteworthy in the sense that Tesla\u2019s growing need for lithium, perhaps more so that that for cobalt and graphite, represents the single most important raw material need. I imagine that other lithium agreements will be signed in coming months. Without question, Nevada wants further lithium\u00a0deals to come from Nevada.\u00a0Western Lithium\u00a0<\/strong>and\u00a0Dajin Materials\u00a0<\/strong>are two other lithium juniors in Nevada.<\/p>\n

By Peter Epstein, CFA, MBA \u00a0\u00a0http:\/\/EpsteinResearch.com<\/a><\/strong><\/p>\n

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Disclosures:\u00a0<\/em><\/p>\n

Several of the companies mentioned herein have small market caps, including Pure Energy and Dajin Resources, small market\u00a0cap stocks are highly speculative, not suitable for all investors. I, Peter Epstein, own\u00a0shares of PE.V. and DJIFF. Mr. Epstein, CFA, MBA\u00a0is not a licensed financial advisor. Readers should take that fact into careful consideration before buying or selling any stock mentioned. Readers are encouraged to\u00a0consult with their own investment advisors before buying or selling any stock, especially speculative ones. At the time that this article was posted, Dajin Resources\u00a0and\u00a0Pure Energy were sponsors of:\u00a0http:\/\/EpsteinResearch.com<\/a>. Please consider visiting: \u00a0http:\/\/EpsteinResearch.com<\/a>\u00a0for free updates on Dajin Resources, Pure Energy and others across a range of sectors. While at\u00a0http:\/\/EpsteinResearch.com<\/a>, please enter an email for instant delivery of my work.\u00a0 Thank you for your support.<\/em><\/p>\n

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By Peter Epstein, CFA, MBA \u00a0\u00a0http:\/\/EpsteinResearch.com On Wednesday, September 16th, Nevada\u2019s\u00a0Pure Energy Minerals (PE.V) \/ (HMGLF) & (AHG1.DE)\u00a0announced the signing of an agreement with\u00a0Tesla Motors Inc. (TSLA).\u00a0To say that this is blockbuster news\u00a0for the Company would be the\u00a0understatement of the decade and in fact might not even suffice.\u00a0Each agreement between Tesla and a junior company […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-78389","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/78389","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=78389"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/78389\/revisions"}],"predecessor-version":[{"id":78390,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/78389\/revisions\/78390"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=78389"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=78389"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=78389"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}