The great battery race – Australian Resource & Investment

As research strives for new and better battery options, lithium and graphite remain the key elements, but aluminium is making its presence known, Regina Meani writes.

We are all part of the race to become more environmentally friendly. A significant part of that race is global electrification, which involves world powers scrambling to gather the necessary minerals required for the process – and our progress. 
It seems graphite is currently viewed as the ‘dark horse’, but we suggest aluminium may tie this race. 
Leaving aside clichés, there has been a massive global surge in research and development for energy storage solutions. The University of Queensland is a key part of that research.
Still an essential part of the humble pencil, graphite is the second largest component by weight in lithium batteries and plays an integral role in electrification. 
A hybrid-gasoline electric vehicle (HEV) can carry up to 10kg of graphite, and a plug-in electric vehicle (EV) has around 70kg. This would equate to more than 70,000 tonnes of natural graphite for the production of every million EVs. 
Coupled with this is the growth of other electronics that rely heavily on lithium-ion batteries, as well as forthcoming developments in portable tools and energy-storage applications.
Producing around 60 per cent of the world’s flake graphite, China is the world’s largest supplier of the mineral, followed by Mozambique and Brazil. Graphite is also produced in Canada, India and Russia. Interestingly, the US – one of the main global forces in the EV industry – has been late to the party on mining graphite.
In Australia, Quantum Graphite’s (ASX: QGL) Uley graphite project is within the wholly owned Mikkira graphite deposit located on the Eyre Peninsula in South Australia. 
The company’s proprietary process is environmentally sustainable and entirely based on renewable energy, and its joint venture with Sunlands Co. sees them use their technology to manufacture the flake graphite-based storage media to be installed within long duration energy storage cells. 
The jagged and gapping actions of the share price history for Quantum Graphite restricts our analysis to a starting point in December 2021. The price rose strongly into 2022 to halt in momentum divergence at $0.38 in February, pulling back to test support at $0.24 before regaining its momentum. 
Breaking away through $0.38 in early May, the price reached another momentum hurdle at $0.52 on May 23. The price paused and pulled back to bounce from support at $0.325 in early September. 
It’s likely that more price churning may occur between $0.32 and $0.43 as momentum rebalances. Beyond this, we would look for a return to the upward path through the $0.45–0.52 area for a potential into the $0.70–0.80 range. 
Quantum Graphite was trading at $0.540 when the article was published online (Tuesday November 29). 
Magnis Energy Technologies (ASX: MNS) is also listed on the New York over-the-counter and Frankfurt markets. The company has vertically integrated its lithium-ion battery technology and materials by holding strategic assets, investments and partnerships in the electrification supply chain. 
Along with its US partners, the company operates a gigawatt-scale lithium-ion battery manufacturing project in Endicott, New York. It has plans to commercialise and patent technology to develop green-credentialed lithium-ion battery cells, with the aim to produce high-performance anode materials utilising ultra-high-purity natural flake graphite from the its Nachu graphite project in Tanzania.
The share price for Magnis Energy has been on a rollercoaster ride from the early 2000s. Following a peak at $2.17 in January 2007, the price fell sharply to a low and turning point around $0.10 in October–December 2008. This spurred a significant recovery to $0.89 in early 2011. 
The pattern of strong upthrusts followed by sharp declines continued with a spike low at $0.24 in mid-2013 and then an interim high at $1.12 in June 2016. The most recent low was $0.47 in April 2020. At this time, a strong reversal developed and expanded to support the 2021 upthrust, which reached $0.755 in November last year. 
The price has pulled back in line with a momentum peak, finding support drawn back to 2008 in the $0.25–0.30 range. The action appears similar to that experienced in early 2016, when the price tackled resistance in the $0.55–0.60 area before breaking through and surging higher. 
A similar outcome would see the price head towards $0.89 through $1.00 and possibly into the $1.50–2.00 range. A drop below $0.40 may delay the upward path.
Magnis Energy was trading at $0.350 when the article was published online (Tuesday November 29). 
Now for the next step.
The University of Queensland’s Australian Institute for Bioengineering and Nanotechnology has been using breakthrough technology for the creation of graphene aluminium-ion cells. The innovative discovery with the Graphene Manufacturing Group (listed on the Toronto Stock Exchange) claims to charge 60 times faster than the best lithium-ion cells, and can hold three times the energy of the best aluminium-based cells. 
The aluminium-ion battery composition consists of an aluminium foil anode, a graphene cathode, and an aluminium-chloride electrolyte. The batteries contain no lithium, copper, manganese, or cobalt. They are safer, with no upper ampere limit to cause spontaneous overheating. Due to their stable base materials, the batteries are easily recyclable, charge much faster and provide a longer range, resulting in a more sustainable outcome.
The technology has been referred to as “game-changing”, offering a real alternative to the existing lithium-ion batteries in almost every application.
With its Toronto Stock Exchange listing, Graphene Manufacturing Group’s share price is quoted in Canadian dollars. The price has been moving in a broad upward channel from the middle of last year, and from July this year has encountered resistance from its mid-way channel in the $C4.00–4.20 zone. 
More churning may occur in the price action beneath this barrier with support in the $C3.00–3.50 area with an upward breakaway through $C4.20, signalling the next stage higher towards $C5.00 and potentially $C6.00 and possibly much higher. A drop below $C3.00 may produce heightened price volatility.
As the great battery race enthrals the world and energy research strives for new and better options, lithium and graphite remain the key elements for the time being, but aluminium is likely to provide a paradigm shift. 
This feature appeared in the October issue of Australian Resources & Investment.
*The article has been updated to reflect current market conditions on Tuesday November 29. 

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