EV Market – Lithium is the New Oil
As North American manufacturers are focused on revamping production to meet the ever-increasing demand for electric vehicles (“EV”), they are running into their biggest challenge - namely the lack of a reliable source of lithium. Foremost Lithium is exploring its properties at an ideal time, when lithium demand will skyrocket thanks to the growing electric vehicle market. A recent report by the IEA states that to meet global net carbon emission goals by 2030, the world will require an additional 50 lithium mines. One tonne of mined lithium ore is required to power 90 car batteries. Over 6.9 million EV’s were sold globally in 2021, and expectations are that by 2030 EV production will rise to over 40 million and that over 48% percent of all newly built global passenger vehicles will be electric vehicles. The current metrics are daunting for the automotive industry supply chain.
The new “Inflation Reduction Act” passed into law by the US on August 17, 2022 represents the most aggressive action in US history to address climate change concerns. Crucial for critical battery minerals, it implements a $7,500 EV credit tax offer. This law puts Canada in a privileged position and will deepen investment into with lithium exploration companies as EV manufacturers and other suppliers scramble to source and secure their critical minerals with an FTA partner. In April 2022, Canada announced its own C$3.8 billion initiative toward a critical minerals strategy. The country is replete with opportunities for lithium mining.
With the Inflation Reduction Act passed, an increasing number of automakers are seeking to build cars closer home to diversify supply chains and lower their dependence on China. Vehicle manufacturers, including Mercedes Benz and Volkswagen both announced they would look to secure battery raw materials, such as lithium in Canada, as part of an agreement with the Canadian government. Foremost’s Lithium Lane properties have the potential to meet future North American demand as these lithium properties, while in early stages of exploration, have returned high grade assay results of lithium concentrates. The Company is eager to engage and partner in this EV green revolution.