Pat McKeough responds to many personal questions about specific stocks and other topics on investment and the economy from the members of his Inner Circle. Every week, his comments and recommendations on the most intriguing questions of the past week go out to all Inner Circle members. And each week, we offer you one of the highlights from these Q&A sessions. While we reserve our buy-hold-sell advice for Inner Circle members, these excerpts provide a great deal of information and analysis on stocks we’ve covered for members of Pat’s Inner Circle. This week, an Inner Circle member asked us about Canada Lithium, which mines a metal used in a highly specialized area. Lithium is a key element in batteries for electric and hybrid vehicles. Pat examines the company’s operations, including two deals with Asian commodities traders, and looks at the longer-term outlook for lithium. Q: Hi Pat: I would like your take on Canada Lithium. Thanks. A: Canada Lithium (symbol CLQ on Toronto; www.canadalithium.com), is nearly finished building an open-pit mine and processing plant at its Quebec Lithium Project, near Val d’Or, Quebec. The project should be fully operational by the end of 2013. (Lithium is used in batteries for electric cars and hybrid vehicles.) The operation, which includes a former lithium carbonate mine from the 1950s and 1960s, will be capable of producing about 20,000 tonnes of battery-grade lithium carbonate annually for 15 years. [ofie_ad]
Mining stocks: Company signs key agreements with Chinese and Japanese commodities traders
The company has just raised $13 million by issuing 17.9 million shares at $0.73 each. It will use the funds to finish the mine and processing plant. Canada Lithium recently signed a five-year sales agreement for a minimum of 12,000 tonnes of lithium per year with Tewoo-ERDC, one of China’s largest commodities traders. The company has also signed another agreement, for up to 5,000 tonnes per year, with Marubeni Corp., a major Japanese commodities-trading company. In the Inner Circle Q&A, Pat looks at the outlook for lithium and how the long-term balance between supply and demand may affect Canada Lithium. He also looks at the outlook for the company’s lithium project. He concludes with his clear buy-hold-sell advice on the stock. (Note: If you are a current member of the Inner Circle, please click here to view Pat’s recommendation. Be sure to log in first.) COMMENTS PLEASE—Share your investment experience and opinions with fellow TSINetwork.ca members Do you believe electric cars and hybrid vehicles will eventually gain a dominant position in the market, or do you think they will continue to be niche products favoured by those with particular environmental concerns? Let us know what you think.
