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By Faith Ashmore, Benzinga
As the globe races to reduce carbon emissions, the electric vehicles (EVs) industry is witnessing a boom. The global EV market was valued at $388.1 billion in 2023 and is expected to reach $951.9 billion by 2030, growing at a CAGR of 13.7% from 2023-2030. Unsurprisingly, lithium-ion batteries, the biggest battery chemistry that supplies EVs, are also experiencing growth. However, with the demand for these industries growing, experts are increasingly concerned over supply chain risks.
In 2021, Australia had the highest lithium mine production in the world; however, Chile, China, Argentina and Brazil are also major contributors to global lithium production. With the increasing global demand for lithium, the development of new lithium projects in regions with large reserves is crucial for meeting the growing needs of the electric vehicle and renewable energy industries. For many investors, Brazil’s lithium valley is shaping up to be a promising target in the coming years, given that Brazil holds the fifth-largest lithium reserves in the world.
Atlas Lithium: The Little-Known Company With Global Partnerships
One company looking to capitalize on Brazil’s Lithium Valley – which holds an estimated 85% of the country’s reserves – is Atlas Lithium (NASDAQ: ATLX). With a focus on sustainable mining practices, Atlas Lithium aims to develop and produce high-quality lithium resources to meet the increasing demand for lithium-ion batteries in various industries, such as electric vehicles and renewable energy storage systems.
Atlas Lithium's flagship project is the Neves lithium project in the state of Minas Gerais. The company reports that the project encompasses a significant lithium resource and has the potential to become a major lithium producer. Atlas Lithium also reports that it stands out in the Brazilian lithium market as the sole company with binding off-take agreements already lined up for its lithium concentrate.
Through strategic global partnerships, the company has secured off-take agreements with Chengxin and Yahua; Yahua is a lithium chemical supplier to Tesla (NASDAQ: TSLA), while Chengxin supplies Chinese EV giant BYD (OTCPK: BYDDY) which is the largest EV maker in the world. These agreements guarantee the sale of 80% of Atlas Lithium's Phase 1 production capacity, and provide Atlas Lithium with $50 million to fully fund its production expected to commence in Q4 2024.
Future Plans And Competitive Standing
Atlas Lithium has set ambitious targets for the upcoming months as it works towards becoming a leading producer of high-quality and ethically sourced lithium resources.
Over the next 3-6 months, Atlas Lithium intends to complete a Definitive Feasibility Study for its Neves Project. The company expects to achieve a major milestone in the production of its first lithium concentrate within 6-9 months. Achieving these targets could set the company up to be a leader in the Brazilian market and a competitor to companies like Sigma Lithium Corporation (NASDAQ: SGML). The company also distinguishes itself from its peers with its low capital expenditure (CAPEX) to production. Through the utilization of modular plant technology, the company reports that it has managed to maintain a low CAPEX to production of just $49.5 million. According to Atlas Lithium, this figure represents only a fraction of what other companies within the sector typically invest.
Although it has yet to achieve widespread recognition, Atlas Lithium boasts a wealth of compelling attributes that could position it for growth and success. The company's partnerships, low capital expenditure and high-quality product, backed by thorough metallurgical studies, are all key advantages. As the electric vehicle market continues to expand, the demand for lithium continues to grow. Atlas Lithium seems poised to emerge as a major supplier of this crucial resource.
Featured photo by myenergi on Unsplash.
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