Elon Musk called outside into the nickel miners of the planet this week to ask a more sustainable method to mine the nutrient. A small Toronto-based miner appears to have accepted the challenge and may win a significant contract in the billionaire’s firm if their renewable nickel manufacturing facility comes through.
Canada Nickel Co. (TSXV:CNC) saw its stock price triple in only four days because Musk made the prosecution. Now, the business may be on the brink of a significant breakthrough which may unlock huge value for early investors. Here’s a closer look.
Elon Musk
The simple fact that the technology billionaire turned his focus to nickel mining shouldn’t come as a surprise. Musk has assembled a lot of money by focusing on renewable energy options and electrical transportation. Compounds like nickel play a critical role in both regions.
In accordance with Musk, nickel-based battery cells have significantly greater energy density compared to classic ion cells now utilized in their own electrical vehicles. Higher density means more array without the additional weight which would compromise rate and grip for Tesla automobiles.
Nickel-based cells might be especially helpful in larger vehicles, like the forthcoming Cybertruck and Semi. To put it differently, the product could play an integral part in Tesla’s long run — that explains why Musk guaranteed a profitable deal for any miner who may think of a more economical, more sustainable means to extract the component.
“Tesla will give you a giant contract for a long period of time, if you mine nickel efficiently and in an environmentally-sensitive way,” Musk explained during a recent earnings call with Wall Street analysts.
That’s where Canada Nickel comes from.
Canada Nickel
Toronto-based Canada Nickel Company told Bloomberg this week it is poised to construct a centre which could process nickel at a zero-carbon way. CEO Mark Selby said the centre could be located from the Timmins-Cochrane area of Northern Ontario.
“The electric vehicle chain and broader market in general is crying out for a zero-carbon product,” Selby told Bloomberg. The report sparked investor attention in a speed that is stunning and the organization is currently worth thrice as far as it had been last week.
Canada Nickel is now valued at $196 million. However, if it increases financing from Musk or wins a contract with no electrical vehicle manufacturer, the stock could take considerably greater.
The international battery business was worth $108 billion final year. It’s predicted to rise 14% annually before 2027. Demand must accelerate as more individuals swap conventional gasoline-powered vehicles for electrical cars. Meanwhile, demand is further magnified by the demand for storage in solar and wind farms. The marketplace may be worth $250 billion by 2027.
If nickel mining becomes more sustainable, miners such as Canada Nickel might be poised for a huge windfall.
Bottom line
Nickel might be a pivotal component in the future of electrical transport. Elon Musk appears to feel that an environmentally-friendly nickel mining procedure might unlock its true capacity. He’s offered a contract for any company that could deliver on this possibility. Canada Nickel Co. could on the brink of doing exactly that.
Fool contributor Vishesh Raisinghani does not have any place in any of those stocks mentioned. David Gardner possesses stocks of Tesla. The Motley Fool owns shares of and urges Tesla.
