Gold miner abandons gold for graphite

We’ve talked a lot about how the electric car and battery industry is creating a surge in demand for lithium. But did you know that the next metal most needed for lithium-ion batteries is graphite?

This – plus the fact that the “super metal” graphene is also made from graphite – has led to a scramble to up production of graphite worldwide.

For instance, last week Bloombergreported that Mark Thomson, head of Talga Resources (a company originally set up as a gold miner), is shifting its focus towards graphite.

From the story itself:

“After seeing the supply chain for batteries and the growth in electric vehicles, we knew we wanted to get into graphite,” said Thompson, a native of Australia who worked for two decades in the mining industry looking mostly for gold.

He studied old drilling records in Sweden to find a seam of graphite more pure that what comes from the low-cost producers in China. Perth-based Talga acquired mining rights from Teck Resources Ltd., a Canadian company that was looking for copper and gold rather than graphite. 

What Thompson found north of the Arctic Circle, near the Swedish town of Vittangi, was a vein he described as a “natural-freak deposit.” The graphite is so concentrated that it can be sliced easily into blocks that are easier and cheaper to process. Supplies from China, the top producer, are extracted from ore speckled with flakes of the carbon-based material, which is extracted in a process that depends on low-cost labor.

While graphite demand is growing, there may be more potential in graphene, the strongest and lightest material known to man. It can conduct electricity even in strands one-atom thick. Using it in lithium-ion batteries could significantly increase the charging capacity and power life, according to the University of Manchester’s graphene research center. That in turn would make more viable electronics of every kind from Apple’s iPhones to Tesla’s electric cars.

This is a story that’s moving on quickly. Growth in electric cars and batteries could lead to demand for all sorts of other materials skyrocketing over the next decade.

Category: Commodities

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