Monday, August 09, 2010

First Uranium, then Potash, Now Copper and Lithium: Friedland sees blue skies for copper on "phenomeon" of Electric Cars TNR.v, CZX.v, LIT, TSLA, LIT;v, RM.v, LI.V, WLC.v, CLQ.v



Will Robert Friedland plug in second leg of the Lithium Bull now? Is it just splash of memories from sweet Uranium hey days and Potash fever or is it sign of the next Bull to come? Only future will tell us, but we can welcome another fine gentleman to our Next Big Thing club. Money is coming into the Lithium sector and now we can see who has already taken positions on the Next Big Thing. Friedland can do to the Lithium Sector what James Dines did for REE last year: he can put it on the radar screens of thousands investors following him. He managed to strike it big with Uranium and Potash and now is positioning Copper as a Green Metal. We have wrote before about it as well and will add to his observations that when you will account for all infrastructure for Electrification of Transportation Copper and Lithium are the metals to be in. In our opinion, Lithium will be more explosive as it is still below the radar screens and industry as a whole is a micro cap compare to Copper Majors. It all can change very fast. Our Top Pick here, as you know is TNR Gold with its Lithium projects to be spin out in International lithium and copper Los Azules play in Argentina. Summer accumulation phase could be over soon with FED QE 2.0 to be announced. Chinese appetite for commodities is growing by the day and Oil is indicating that there are places with growth and demand is already clashing with supply.

We have a position in the company, please, do not take anything as an investment advise on this blog, as usual.




Friedland sees blue skies for copper


BARRY FITZGERALD

August 9, 2010




The mining promoter extraordinaire Robert Friedland was at his uber-cool best at last week's Diggers & Dealers bash in Kalgoorlie, dispensing insights on the world of metals like he was reading them off a box of Corn Flakes.



Friedland is noted for being first among the miners to call the rise and rise of metals demand from China on its urbanisation and industrialisation boom. So when he talks, people listen.



He is the boss at the Canadian company Ivanhoe (owned 23 per cent by Friedland and 29 per cent by Rio Tinto). Ivanhoe owns 66 per cent of the world's next great copper mine with associated gold output, the Oyu Tolgoi project in Mongolia's Gobi desert, with the government holding the rest.



From all that you would expect him to bullish on the outlook for copper. He is a major bull.

Friedland pointed out that the while the world mined 585 million tonnes of copper metal from 1900 to 2008, it will need to mine 600 million tonnes of copper in the next 20 years alone, assuming 3 per cent global economic growth.



''Frankly, those of us in the business have no idea where this metal is actually going to come from,'' he told delegates.



But more importantly, Friedland reckons that the forecast need for 600 million tonnes of copper over the next 20 years not including the demand to come from the ''phenomenon'' of electric cars. He believes that hybrid cars are old news. The world will shift its car fleet over to lithium battery-powered electric over the next 20 to 30 years or so, waving goodbye to reliance on Middle East oil supplies at the same time.



Good news for those chasing lithium as the next big thing. But don't forget copper, Friedland added.



He pointed out that a lithium battery is made out of a copper foil which is sprayed with graphite and lithium/cobalt oxide. ''And when you roll that puppy up and put it in your car, 80 per cent of the weight of the battery is copper metal.''



So a large sedan with a 450-kilogram battery will have about 360 kilograms of copper metal in it. Multiple that by the 500 million people who will want electric cars, and the implication for the copper market is ''breathtaking''.



POWER OF ZEUS



Friedland also let slip that Zeus is coming to the Cloncurry region of north Queensland, which must be an exciting prospect for the locals.



But we're not talking about the father of gods and men. We're talking about a remote sensing geophysical exploration technology (induced polarisation and resistivity), in which well-mineralised zones at depth can be picked out from the weakly mineralised host rocks after being given an almighty blast of electricity.



''It allows us to sort the haystack [unmineralised country rock] from the needles [mineralisation],'' Friedland said. He believes Zeus is ''redefining the frontiers of discovery''.



He said it was pointing the way to Oyu Tolgoi's future in that it was coming up with all sorts of juicy targets on top of the huge resource base already outlined. And if you have lost your old VW at Cloncurry, Zeus can help.



''Zeus is looking two kilometres deeper than any other known technology. We can bury a 1957 VW three kilometres deep and show why it's not a 1958 by the shape of the rear bumper,'' Friedland said.



He can't wait to bring the technology to the Cloncurry region where Ivanhoe's 81 per cent-owned Australian offshoot, Ivanhoe Australia is making a name for itself as a copper-gold and rhenium-molybdenum developer. It also has a major ground position which will get ''Zeused''.



ALL EYES ON EXCO



Things are stirring elsewhere in the Cloncurry region, with Exco Resources getting a speeding ticket from the exchange last week asking for any reasons behind its share price rise.



The stock rose from 28¢ a share to 35¢ by Friday. Exco said it was talking with a potential strategic investor about a possible placement of shares to support the group's plans for the development of its Cloncurry copper project.



As pointed out by Garimpeiro in June, when the stock was 25.5¢ a share, Exco has been talking to Xstrata for five years to have its E1 Camp copper resource become an ore supplier to Xstrata's Ernest Henry hungry treatment plant, eight kilometres to the east.



The chat rooms were full of talk last week that the strategic investor Exco was talking about was of the Chinese variety. If that is the case, Xstrata will have gone on high alert given the money to be made by keeping the Ernest Henry mill full.



We might have a battle on our hands, with the boys from Zug up against the boys from Beijing.



bfitzgerald@theage.com.au



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