Why Australian Mines Limited’s Share Price is Up 15% Today

At time of writing, the share price of Australian Mines Limited [ASX:AUZ] is up 14.9%, trading at $0.054 on the back of significant volume.

Australian Mines is a resource company that is focused on the production and supply of battery and technology metals.

It is developing three different cobalt/cobalt-nickel-scandium projects at Sconi, Flemington and Thackaringa.

Cobalt stocks could be set for a bumper year. Download our free report to learn how to profit from the battery boom.

Recent drilling by Australian Mines ‘highly encouraging’

Moving today’s price was an announcement out of the company that they had returned ‘further positive results’ from resource extension drilling at the Sconi Project.

The company is planning for Sconi to become, ‘a fully-integrated chemical processing operation capable of delivering battery-grade cobalt sulphate and nickel sulphate.’

Managing Director Benjamin Bell noted that, ‘the results to date are pointing towards an increase in the Sconi project’s Mineral Resource for both cobalt and nickel.’

They have an off-take agreement with Korean-based SK Innovation for use of their resources in SK Innovation’s electric vehicle battery manufacturing plants.

Cobalt is an essential ingredient in lithium ion batteries — and the technology behind the batteries is poised to drastically improve due to 3D printing, as covered previously on our sister site Money Morning.

This could launch exponential growth in the uptake of electric vehicles that run on lithium-ion batteries.

Another mineral it is seeking is scandium, which is used to produce aluminum alloys for car chassis and aircraft fuselages.

Where does Australian Mines’ share price go from here?

As Australian mines is focused primarily on cobalt, nickel and scandium, its share price will likely fluctuate with the prices of these resources.

Below are the five-year charts for cobalt and nickel resources:

Cobalt Price

Source: infomine.com

Nickel Price

Source: infomine.com

 

The price of scandium is not tracked on an index, but it has fluctuated between US$4,000 and US$20,000 per kilogram over the past decade.

As you can see from the above, cobalt has recently enjoyed a renaissance as the prospect of massive demand for use in batteries begins to loom.

We have previously discussed how Australia has the second largest deposits of cobalt in the world.

Unlike the Democratic Republic of Congo (DRC), which has the most cobalt, Australia is politically stable and can ensure that the cobalt is mined ethically. Something which is of particular interest to major lithium-ion battery users such as Tesla.

Therefore, further uptake of electric vehicles could strengthen Australian Mines share price.

Regards,

Lachlann Tierney

For Markets and Money

PS: If you are thinking of making a cobalt play, our free report on the battery boom is a must read. You can download it here.


Lachlann Tierney is a writer for Markets & Money. He has lived and studied in the US, the UK, and Australia. With an MSc from London School of Economics (LSE) he brings a strong grasp of geopolitics and world affairs to his analysis. Lachlann is always on the lookout for the news that will give you an edge in tomorrow’s markets.


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