By: Dylan Sikes - AllPennyStocks.com News

Thursday, December 10, 2015

According to the Sydney Morning Herald, lithium prices are expected to rise strongly over the next two years. The price increase will be driven by increasing adoption of electric cars. Sydney Morning Herald describes the increasing adoption of electric cars as a “game changer” for lithium. Citing Citigroup analyst Matthew Schmebri, the paper notes that currently the demand for lithium primarily comes from industrial companies that focus on the production of ceramics and glass but demand will rise substantially when electric vehicles become mainstream and require the commodity to run lithium-ion batteries.

Citigroup expects a significant increase in the production of pure electric vehicles. According to the bank, production of electric vehicles will increase from 150,000 this year to 290,000 in 2016. By 2020, Citi expects electric vehicles production to increase to 1.04 million units. Not surprisingly, analysts are quite bullish on the outlook for lithium prices.

The bullish outlook also means that several new projects are being undertaken to meet the growing demand. This morning, Canada-based International Lithium Corp. (TSX-Venture:ILC) announced progress with its project in Argentina. International Lithium primarily focuses on the Mariana lithium-potash brine project, which is located within the well-known South American lithium belt. The lithium belt hosts the vast majority of global lithium resources, reserves and production.

ILC along with its strategic partner Ganfeng Lithium Co. Ltd. announced that a preliminary budget of $4 million has been approved for exploration and development work during 2016 on the Mariana and Avalonia joint venture projects. The two companies have allocated a budget of around $750,000 euros (approximately $1.1 Million CDN) to the 2016 Avalonia exploration season with the rest dedicated to the Mariana Lithium project in Argentina.

ILC said that in Argentina, the funds will be used to commence investigation of the natural evaporation concentration process of the brine.

Commenting on the development, Kirill Klip, President at International Lithium, said that the company has always viewed Argentina as a favorable location for mineral exploration and development and have been able to operate in a mutually beneficial manner with the local people and governments. Mr. Klip further said that the results of the recent elections have managed to give foreign corporations greater confidence in the future of business and mineral resource development in Argentina. He added that the company continues to build a vertically integrated lithium business with Ganfeng Lithium to meet the future demand of lithium products that will address the increasing demands for lithium raw materials and chemical products.

Shares in ILC are even on the day ($0.06) with light volume of 23,500, however shares have been on an uptrend for much of 2015, which is quite impressive considering the massive sell-off in junior miners over the same time period.

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