As the world phases out the use of coal in favor of cleaner energy, the production and use of electric vehicles continues to grow. While metals such as lithium have played a big role in the energy transition, the unsung players in this transition are copper and nickel.
The price, availability and sustainability of these two metals are critical for the growth of the electrical vehicle fleet globally. The red metal, in particular, is essential to all plans involving the energy transition, as deeper electrification requires wires, which are primarily made from copper.
Nickel is the cathode material utilized in the production of electric car batteries, as it increases energy density in batteries. The amount of nickel in the battery determines how long it stays with its charge. A typical 60kwh electric vehicle battery has roughly 40kg of nickel, 6kg of lithium and 5kg of cobalt.
Copper is also used in batteries to make collectors, which transfer the energy to the anode from the cathode. This is in addition to being used in the charger, motor and other electronics. In comparison to an internal combustion engine passenger car, electric vehicles use almost four times as much copper.
It is expected that in the next 10 years, the demand for nickel for batteries will increase by 500%, driven largely by the rising demand for electric vehicles.
A major player in the mining sector, BHP, plans to become a key player in the transition primarily through the supply of nickel. The company will work with its partners to improve the sustainability of its copper and nickel operations while also developing new technologies to meet the growing demand. BHP is also focused on improving the efficiency of its operations, in addition to investing in research and development of new mining technologies.
In addition to this, the mining giant plans to collaborate with other organizations and companies to develop new recycling technologies for electric vehicle batteries. This will help ensure long-term availability of copper and nickel. On the supply side, BHP is focused on identifying mineral exploration start-ups that will accelerate strikes of nickel and copper through early-stage entry and exploration, through its BHP Xplor program.
Xplor VP Sonia Scarselli stated that the program was not only focused on finding critical resources needed for the energy transition but also committed to accelerating the way the resources were found and determining alternative ways to fund resource development and production. This will empower start-ups while also saving time from discovery to production.
Given how important nickel is to the energy transition away from fossil fuels, extraction companies such as Canada Nickel Company Inc. (TSX.V: CNC) (OTCQX: CNIKF) can look forward to favorable market conditions in the years and decades to come.
NOTE TO INVESTORS: The latest news and updates relating to Canada Nickel Company Inc. (TSX.V: CNC) (OTCQX: CNIKF) are available in the company’s newsroom at http://ibn.fm/CNIKF
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