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April 12th, 2022 | 20:28 CEST

Nel, Standard Lithium, Power Nickel: Shares for the electric boom

  • Nickel
  • Lithium
  • Electromobility
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BYD and Tesla are celebrating new delivery records in 2022 - and the trend continues to rise. German automakers are also trying to keep pace with electromobility with new models. But success has long since ceased to depend solely on technology and brand; the supply of raw materials is increasingly becoming a critical factor. Lithium and nickel, in particular, are in short supply, and prices are going through the roof. The shares of Standard Lithium and Power Nickel, among others, are benefiting from this. While Standard Lithium has been able to win groups as partners, the spin-off of Power Nickel's gold activities is providing additional share price potential. Hydrogen also has great potential, regardless of whether it will play a role in cars in the future or not. With the latest cooperation with the energy supplier Iberdrola, Nel is taking a further step to secure a piece of the pie.

time to read: 4 minutes | Author: Fabian Lorenz
ISIN: NEL ASA NK-_20 | NO0010081235 , STANDARD LITHIUM LTD | CA8536061010 , Power Nickel Inc. | CA7393011092

Table of contents:

    Jerre Foo, Corporate Development Executive, Silkroad Nickel
    "[...] China has become the manufacturing capital of the World, and because of its infrastructure, expertise and capabilities, Silkroad Nickel has strategically positioned itself to partner with Chinese companies in the Stainless Steel and EV industries [...]" Jerre Foo, Corporate Development Executive, Silkroad Nickel

    Full interview


    Power Nickel makes itself pretty for big mining companies

    A successful mobility revolution requires not only vast quantities of lithium but also nickel. Unlike lithium, nickel is already mined on a large scale, but around 85% of it is currently used for the production of stainless steel and alloys. That is set to change massively in a few years. As early as 2025, the share of nickel produced worldwide for use in batteries is expected to increase from 5% to up to 21%. Power Nickel should benefit from this. The Canadian explorer is currently pushing ahead at full speed with the development of the James Bay High-Grade Nickel-Copper-Cobalt-Palladium Project NISK. Located in the Canadian province of Quebec, it comprises a large land position with 20 km of strike length and numerous high-grade intercepts. Recently, another drill program was completed. "These results are another positive indication that NISK is a very exciting nickel sulfate discovery. Our objectives in this first drill program conducted by Power Nickel were to drill enough holes to expand the nickel mineralization known to date," said Terry Lynch, CEO of Power Nickel. A concrete resource estimate is expected to be released in the second quarter. Following this, a fully funded 5,000-meter drill program is scheduled to commence.

    With this, Terry Lunch is following up his announcement with action. In an interview at the beginning of March, the Company boss had said: "The historical estimates assume around 3 million tons of nickel at NISK. We believe we can more than triple that figure in the medium term and end up with a project that will convince the market and attract interest from mining companies." In addition to the progress at NISK, a second project at Power Nickel is sparking share-price imagination: The gold and copper activities in Canada and Chile are to be spun off and listed on the stock exchange. Power Nickel intends to retain an 80% stake in both companies and issue the remaining 20% to Power Nickel shareholders. So the coming months should be exciting for Power Nickel.

    Standard Lithium with support from Lanxess and the US government

    Recent weeks have shown how dependent many countries are on imports - in the worst case from Russia - for raw material supplies. This has not escaped the attention of the USA either. The country is largely self-sufficient in oil and gas. But there, too, the trend is toward electromobility. Accordingly, the US president recently announced that he would promote the development of domestic lithium projects. Details are not yet known, but a big winner of this should be Standard Lithium. Standard Lithium's project in the US state of Arkansas could soon become the largest lithium project in North America. To achieve this, Standard can rely on strong partners: German chemical giant Lanxess and US conglomerate Koch Industries. The share was one of the big winners in March. Nevertheless, it is around 30% away from its all-time high of just under EUR 11 in October 2021.

    Nel successful in Spain and Germany

    The Nel share still has a long way to go to reach its all-time high of over EUR 3. It is currently trading at EUR 1.60. But the topic of hydrogen is currently bigger than almost any other. Experts tend to doubt its use in passenger cars, but hydrogen is at the top of the list for subsidy programs because of its versatility. Currently, the focus is on replacing gas imports from Russia and its use in commercial vehicles. Hydrogen pioneer Nel is benefiting from this. The Norwegians have now achieved another success in Spain. The joint project with the Spanish utility Iberdrola has received important financing.

    The European Investment Bank (EIB) and the Spanish credit institution Instituto de Crédito Oficial (ICO) are providing the partners with around EUR 88 million. With this, Nel and Iberdrola intend to realize one of the largest hydrogen plants in Europe. A solar park with a capacity of 100 MW is to be built halfway between Madrid and Malaga. The energy is to be stored in a battery with 20-kilowatt hours and then converted into green hydrogen. Nel is also making progress in Germany. For example, Nel subsidiary Everfuel has received an order to build a hydrogen filling station for heavy-duty vehicles in Wuppertal. In the future, fuel cell buses for local public transport will be refueled there. Initially, a capacity for refueling 20 fuel cell buses per day is to be built. Due to the modular design, an expansion of the refueling station is possible at any time.

    Raw materials are in a supercycle. Power Nickel is making itself pretty for a takeover by a major mining group, while Standard Lithium should remain one of the top picks in the lithium space. Nel has had a good newsflow in recent weeks, but the big news is still missing.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    Fabian Lorenz

    For more than twenty years, the Cologne native has been intensively involved with the stock market, both professionally and privately. He is particularly passionate about national and international small and micro caps.

    About the author

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