PALM BEACH, Florida, October 23, 2018 /PRNewswire/ --
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Vanadium is the latest super metal that could serve as the cornerstone of a disruptive new trend: electrical energy storage. Resource companies such as United Battery Metals (OTC:UBMCF) (CSE:UBM) have begun to target this trend, opting to develop a vanadium project in Wray Mesa, Colorado. The company also has a footprint in uranium mining, a space that includes miners such as Ivanhoe Mines (TSX:IVN) (OTC:IVPAF) and Largo Resources (TSX:LGO) (OTC:LGORF). Other players in the vanadium space include Clean TeQ (TSX:CLQ) (OTC:CTEQF) and mining giant Glencore PLC (OTC:GLNCY).
For miners such as United Battery Metals (OTCPK:UBMCF) (CSE:UBM), the vanadium opportunity could be one to watch out for. Vanadium has several practical applications, including uses in solar, wind, grid power storage, and the production of steel rebar. Vanadium is crucial to the U.S. for its domestic steel production which has been jumpstarted since the Trump administration was elected. With U.S. Steel and other major steel companies opening new projects and canceling previous closures, the nation's producers could require a serious amount of vanadium to strengthen their steel products.
Vanadium is one of the 35 elements the U.S. government has deemed critical to the world's largest economy and national security, which could expedite UBM's Wray Mesa project located in Colorado to go into possible production. As the trade war with China intensifies, it could become crucial for America to secure a domestic supply of vanadium and focus on putting mines into production, a move the U.S. administration is expected to support. Vanadium's many use cases have helped drive the price of V2O5 vanadium pentoxide flake 98%, a common form of vanadium, up 400% over the last three years.
With transportation battery demand expected to jump 40-fold by 2040, vanadium could be poised for significant inroads in the EV market. All those new EVs on the road could require charging stations to "fuel up", and vanadium redox batteries offer a perfect solution as VRB's can simultaneously charge 50 cars at a time.
As battery demand increases the demand for vanadium could follow a similar trend, posing a potential supply crunch as more nations adopt alternative energy policies that move away from fossil fuels. That move could potentially bode well for vanadium miners such as United Battery Metals (OTCPK:UBMCF) (CSE:UBM) who is sitting on a large vanadium-rich land package.
VRBs can be also used in power stations to charge electric vehicles. Just as gas stations have become an integral part of U.S. automotive history, so too could VRB charging stations become an essential component to electric vehicle infrastructure.
Although vanadium is essential to everyday economic and national security functions in the U.S., the country is not a major producer of the mineral. In fact, United Battery Metals (OTCPK:UBMCF) (CSE:UBM) is on track to potentially become North America's lone active vanadium producer.
The Vanadium Revolution Is Here
Vanadium appears that it could become an important part of the global energy storage revolution, which could compel other miners including Clean TeQ (TSX:CLQ) (OTCQX:CTEQF) and Glencore PLC (OTCPK:GLNCY) to carve out their own vanadium footprints. Market forces are already at work with vanadium, stoking rapid price appreciation of the element on the spot market. Energy storage is a booming industry, with one estimate indicating energy storage in the U.S. alone is poised to surge to 720 megawatts by 2020, up from 120 megawatts in 2014.
California has recently announced that by 2020 all homes and mid-rises will be required to install solar panels. It is here that VRBs can play a part. The ability to store power from low usage periods and spill it back into the grid during peak demand periods makes VRBs a far superior choice for large-scale energy storage than lithium-ion batteries. Experts predict that it is just a matter of time before this law will be adopted nationwide. Regulations such as these could become a big driver for vanadium demand in the United States, a country in desperate need of a domestic resource.
The vanadium redox battery (VRB) is the optimal choice for electrical storage systems, smart grids, and remote power stations. For applications including power quality control, emergency power, backup power, and stabilization of renewable energy, VRBs offer a potentially superior alternative to the lithium-ion batteries that grew to prominence in the first wave of electrical storage and EV adoption.
"Vanadium could become a vital ingredient in large clean-energy batteries, in which case it will shine a lot brighter," according to The Economist. "Its price has already been rising faster than cobalt, copper, and nickel, all of which are used in lithium-ion batteries."
Miners that are focusing on vanadium, including United Battery Metals (OTC:UBMCF) (CSE:UBM), could be ideally positioned to exploit rapid growth in this market. The global vanadium market is expected to notch a compound annual growth rate (CAGR) of 3.2% from 2017 through 2027, according to Mining Weekly.
Stored electrical systems could become a major driver of vanadium demand. These systems offer advantages over traditional power sources, including environmental benefits, lower costs, and superior reliability. According to analysis by Report Buyer, the global advanced energy storage market is predicted "to grow with a CAGR of 5.9% over the forecast period of 2018-2024." The potential growth of the energy storage market could be a massive opportunity for a vanadium miner such as United Battery Metals (OTC:UBMCF) (CSE:UBM) that is capable of meeting demand.
United Battery Metals (OTC:UBMCF) (CSE:UBM) is the first mover in the North American vanadium industry with a head start in the race to meet increasing VRB demand. Over the past six years, over 70 VRB-related projects in 11 countries have popped up.
Drilling Down On The Vanadium Opportunity
Mining is a global business. For example, major companies such as Ivanhoe Mines (TSX:IVN) (OTCQX:IVPAF) and Largo Resources (TSX:LGO) (OTCQX:LGORF) often depend on countries far from their home domiciles as primary production points. Currently, the bulk of the world's vanadium production is occurring outside of North America. North America represented just 3% of global vanadium output in 2017, meaning there is a massive opportunity for the next American vanadium company capable of graduating to production.
United Battery Metals (OTC:UBMCF) (CSE:UBM) is leading the charge to tap North American vanadium reserves, which is a welcome development considering the U.S. government has declared vanadium to be essential to national security. Today the world's top two vanadium producers are China and Russia (almost two-thirds of global output in 2017), neither of which are going to prioritize U.S. interests.
With the U.S. currently importing 100% of its consumed vanadium, domestic projects targeting this essential mineral are taking on added importance. That includes United Battery Metals' (OTC:UBMCF) (CSE:UBM) Wray Mesa project in Montrose County, Colorado.
Approximately 240 miles southwest of Denver, Wray Mesa is home to 108 contiguous land claims spanning 3000 acres. Wray Mesa's location is enviable as it is accessible from multiple interstate highways via Colorado or Utah and includes municipal water access from only 6 miles away. The property was previously mined for uranium, most recently in the late 1970s and early 1980s, meaning there is still potential for United Battery Metals (OTC:UBMCF) (CSE:UBM) to make further vanadium discoveries on the property.
The Future Of Energy Storage
Vanadium is rapidly becoming a credible competitor to lithium-ion in the booming stationary storage market. By 2028, a quarter of the world's stationary storage devices could be powered by VRBs. Last year 17% of all power generated in the U.S. was via renewable sources, a number that is expected to grow in the years ahead as states such as California and Hawaii aim to generate 100% of their power from renewables.
With vanadium becoming an essential part of North America's economic and renewable energy futures, companies with quality assets could stand to benefit. In the United States, United Battery Metals' (OTC:UBMCF) (CSE:UBM) Wray Mesa project could be optimally positioned as vanadium buyers look to minimize transportation costs and the risks associated with doing business with Chinese and Russian miners.
The appetite for renewable energy in the U.S., whether for storage systems or vehicles, is robust and getting stronger. With vanadium prices currently at a 13-year high, the market appears to be waking up to the next battery revolution. These market conditions could potentially set the stage for a miner such as United Battery Metals (OTC:UBMCF) (CSE:UBM) to capitalize on the vanadium trend, providing America with the vanadium it needs for years to come.
To learn more about United Battery Metals (OTC:UBMCF) (CSE:UBM), please follow this link to a full report about the company here
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