VIDEO - Howard Klein: Opportunities in Battery Metals After Tesla’s Battery Day

The past few weeks have been interesting for the battery metals space, with Tesla’s (NASDAQ:TSLA) Battery Day leaving many market watchers with unanswered questions.

To help investors make sense of announcements related to battery improvements and the outlook for raw materials, the Investing News Network caught up with Howard Klein of RK Equity.

“The message of 3 TWh by 2030 translates into something like 2.5 million tonnes of lithium, just for Tesla alone — and obviously, these are aspirations,” he said. “But even if (Tesla) gets half of that, it just demonstrates that the movement to the displacement of internal combustion engine cars with electric vehicles is probably happening sooner.”

Klein also said that Tesla’s announcements are positive for the lithium-ion battery, which in turn is positive not just for lithium, but also for nickel demand.

Speaking about CEO Elon Musk’s call to source raw materials from North America for Tesla’s North American operations, Klein said hard rock stories in the region are going to get renewed attention despite all the talk about sourcing from clay.

“He’s basically saying, if you source in North America, you could reduce the kilogram times kilometer metric by 80 percent,” Klein explained. “He’s very focused on shortening supply distances for sustainability reasons, manufacturing scalability reasons. And he didn’t say it, but I definitely think security of supply reasons as well.”

On Battery Day, Musk said Tesla has acquired rights to lithium-rich clay deposits in Nevada. A few days later, junior miner Piedmont Lithium (ASX:PLL,NASDAQ:PPL) signed a deal with the electric vehicle maker to supply lithium spodumene concentrate from its deposit in North Carolina starting in 2022.

“(Clay) is definitely not the story of Battery Day, hard rock to hydroxide is the story of battery day. And everyone who has hard rock projects in jurisdictions where (Tesla) is manufacturing cars,” he said. “So which suppliers of lithium and nickel are best placed geographically, have the best projects that can be sustainable, that could be low cost — those are the ones that you should be looking for.”

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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: Piedmont Lithium is a client of the Investing News Network. This article is not paid-for content.

The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.