Future Of Big Oil Is Lithium

The big question for energy fuel providers: what now? Renewable energy is growing in popularity, economically it makes more sense as prices continue to drop for wind and solar, and politically the United States government is taking notice.

On the state level, several governments have already put into place either policies calling for 100 percent renewable energy or limiting the total amount of oil and gas produced. In other words, slowly but surely energy created through fossil fuels will be a thing of the past.

Many arguments against the advancement of renewable energy solutions and energy efficiency as a whole have been shaped around the idea that the destruction of an entire industry will negatively affect the national job market and economy. To the contrary, clean energy jobs have surged using transferable skills to employ both new and out of work technicians. Furthermore, the cost effectiveness of “going green” is also helping companies increase revenue and compete on a global level.

Now, according to Jeff McDermott of Greentech Capital Advisers LLC, there is even a future for existing energy providers to stay in the game for another generation: “They should buy lithium miners, get involved in the upstream of core battery technology.”

Lithium is an essential ingredient in rechargeable batteries. Every rechargeable electronic requires some type of lithium battery from your smartphone to power sources for solar panels and wind generators. McDermott argues energy companies are discovering that solely transitioning to renewable resources leaves a notable profit divide. However, using both current financial capital and knowledge of project based ventures, these companies can repurpose existing mining tools and technology to excavate lithium. By doing so, the very same corporations worried about losing their shirts would find themselves at the forefront of a booming industry.

Bloomberg New Energy Finance projects, “Demand for the mineral is projected to rise 38-fold by 2030 to 7,845 metric tons per year from 200 metric tons in 2016.” That type of demand spells out a bright future for lithium and should encourage current oil and gas providers to consider their long term game plan. This is an opportunity that both land based and offshore projects could capitalize on to thrive as energy efficiency becomes the predominant form of energy. Business is a game of survival of the fittest. Rather than fight the future, Big Oil, join it.

Source: Bloomberg

Q1 18 Logo

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s