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The Tesla Connection: Cobalt, Lithium and Canada’s far North

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Cobalt, Lithium and Canada’s far North

Nestled in the wilderness off Great Slave Lake’s shores in Canada’s Northwest Territories is the secluded, subarctic First Nations community of Whatì, population 492.  Caribou, gray wolves and black bears roam. There are no all-season roads.

Nearly 3000 kilometres away in the arid flats of Sparks, Nevada, population 90,264, Tesla is constructing Gigafactory 1, an industrial juggernaut which will one day build enough batteries to power 500,000 Tesla vehicles each year. The factory alone will employ more than 13 times Whatì’s population.

Two locations could seldom have more differences, but they have a connection: cobalt.

Unsung Hero of the Electric Revolution

Cobalt is the little known component to Lithium-ion batteries poised to power the clean, green machines of the future. Near Whatì, there are literally tonnes of it – along with Fortune Minerals’ NICO - a mine project just waiting for investment and market movement.

Gigafactory 1 on its own will require at least 7000 additional tonnes of cobalt each year, nearly equal to the total annual production of China, the world’s second largest producer. 

And, with demand increasing exponentially, Tesla has committed to sourcing its cobalt entirely from North America, further restricting supply.

The NWT presents a politically stable, near-untouched opportunity for investors, both in the advanced-stage NICO project and for further exploration as demand continues to grow with the proliferation of electric vehicles.

A Second Life for Lithium?

Cobalt isn’t the only metal found in the NWT on the precipice of a demand spike. There are also lithium possibilities.

With many confirmed showings, lithium exploration in the NWT dates back to the 1970s. While there are no advanced-stage projects, the expected spike in demand already has some major players rethinking their approach.

"Now is the time. If there was ever a time, now is the time," Adrian Lamoureux told CBC last year of efforts to build a lithium mine in the NWT. His company, 92 Resources, also acquired a tract of land at Hidden Lake, north of Yellowknife for exploration. Government geologists have also been working to identify lithium deposits in the area.

Avalon Advanced Materials, owner of the Nehchalacho Rare Earth Elements deposit 100 kilometres east of Yellowknife, is also jumping on the wagon.

"[Nehchalacho] actually has known lithium occurrences on it and we're considering spending a little time looking at that, possibly as a potential lithium asset as well as rare earth," Avalon president Don Bubar also told the CBC. "There's going to be a need for lots of new producers to serve this market."

Exploration for the Future

With a vast, largely unexplored land and dozens of showings of lithium and cobalt, the NWT is an attractive locale with massive potential to fulfill future demand.

Beyond the rocks, it’s a jurisdiction with proven public support for the mining sector. Last year, an Abacus Data survey commissioned by the NWT and Nunavut Chamber of Mines found eight in 10 residents felt positively about mining and exploration.

“Our supportive populace is one of many unique propositions we can offer companies looking to invest,” notes NWT Minister of Industry, Tourism and Investment Wally Schumann.

Demand will only continue growing as more electric vehicles and other battery-bearing devices hit the market - and the NWT is well positioned to provide the supply.