- The unexpected rise of the COVID-19 pandemic has roiled markets on a global scale, but the economic outlook for China’s large electric vehicle (EV) market clearly remains promising
- Canadian mineral explorer Bolt Metals Corp. is pursuing a strategy of playing a part in China’s EV supply chain, anticipating that its Indonesian Cyclops Nickel-Cobalt project will further its plans
- Bolt is focused on the acquisition and development of production-grade EV battery metals projects in the Asia-Pacific region, anticipating that world leaders’ climate change policies will boost EVs’ fortunes
- Indonesia is working to use its metals resources to make itself a key player in the EV market, particularly in nearby China, where the stainless-steel industry is expected to be heavily reliant on Indonesian exports
- Bolt recently inked a non-binding cooperative agreement with Chinese metals producer Hunan Jinxin that advances its ties to the nation’s markets
It’s no surprise that the advent and rapid global spread of the novel coronavirus widely known as COVID-19 has disrupted production supply chains across the commercial spectrum and led to reduced market expectations for industries deemed “non-essential” during a period of pandemic-level illness that has proven deadly and debilitating for a significant portion of the world’s population.
Despite the bleak forecast for EVs and the knock-on effects on raw materials, equity analysis firm Wood Mackenzie notes that the coronavirus is an anomalous event that may disrupt the course of action taken to slow climate change, such as EV production and sales, but the overarching goal of sustaining global environments remains an irresistible driver (http://nnw.fm/Q7AgC). In such a light, the long-term outlook in exploration for EV battery metals continues to look positive.
Bolt Metals Corp. (CSE: BOLT) (OTCQB: PCRCF) (XFRA: NXFE) made news last month when the company inked a non-binding cooperative agreement with Chinese tungsten and cobalt producer Hunan Jinxin. The agreement opens the door to completing potential definitive binding agreements on mineral sourcing from Bolt’s 100 percent-controlled Cyclops Nickel-Cobalt project based in Indonesia (http://nnw.fm/0Jn3a).
While extensive exploration of essential EV supply chain metals such as nickel and cobalt has been taking place at the project in Indonesia – a country known as the world’s largest nickel ore producer – Bolt Metals acknowledges that the possibility of proceeding to production at the site has yet to be established.
“The agreement does not imply that the Company has made a decision to proceed to production without first establishing mineral reserves,” a report clarification issued by Bolt Metals states. “The Company has not made the decision to proceed to production and clarifies that any such statement if made in the future would be made in compliance with Companion Policy 43-101CP, 4.2(6) – Production Decision, which requires details of the significant risks associated with such a decision.”
Even so, the agreement is expected to further Bolt’s strategy to acquire and develop production-grade battery metals opportunities throughout the Asia-Pacific region and become a participant in China’s electric vehicle supply chain. China has been a world leader in EV sales, but sales began to slow last year when the government trimmed environment-friendly subsidies. The pandemic added to the pressure, but the government is now considering reviving its incentives program to strengthen the market (http://nnw.fm/oF0Zs).
Indonesia has been angling to make itself a dominant player in the electric vehicle cathode supply chain thanks to its mineral resources and proximity to the Chinese market. Actions taken by the government last year were expected to make the Chinese stainless steel industry heavily reliant on Indonesia’s exports of ferro-nickel and nickel pig iron (NPI), although the unexpected effects on mineral demand brought about the pandemic outbreak in China has suspended industrial operation there on a large scale (http://nnw.fm/ku2dN).
A slight decline in NPI output in China during the first two months of the year when China was dealing with the height of its pandemic response was offset by doubled NPI supply from Indonesia, according to S&P Global Platts (http://nnw.fm/POa0o). NPI’s substitution for high-grade nickel caused consumption of the Class-I mineral to decline, but the overall picture is that the pandemic had limited impact on nickel supply and demand in China, the energy and commodities markets analyst stated.
For more information, visit the company’s website at www.BoltMetals.com
NOTE TO INVESTORS: The latest news and updates relating to PCRCF are available in the company’s newsroom at http://nnw.fm/PCRCF
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