Nevada Lithium Juniors Jump on News of Tesla Gigafactory
The share prices of Nevada lithium juniors Western Lithium, Lithium Corporation and Pure Energy Minerals spiked today on news that Tesla Motors will build its lithium-ion battery gigafactory in the state.
The share prices of Nevada lithium juniors Western Lithium (TSX:WLC), Lithium Corporation (OTCMKTS:LTUM) and Pure Energy Minerals (TSXV:PE) spiked today on news that Tesla Motors (NASDAQ:TSLA) will build its lithium-ion battery gigafactory in the state. The location of the factory is anticipated to be officially announced at a press conference in Carson City on Thursday, according to USA Today. The news outlet reported that Tesla has been excavating near Reno, but the company has not officially confirmed that the location will be the site of its new factory. Western Lithium rose 37.5 percent on the news, closing at $0.88, while Lithium Corporation jumped to $0.098. Pure Energy spiked 27.03 percent to finish at $0.235. Chris Berry, energy metals analyst and founder of House Mountain Partners, told Lithium Investing News that the gigafactory news has everything to do with the share price spikes. Though he conceded that Tesla has said it will not limit its search for raw materials to North America, he also said that "presumably lithium, graphite or cobalt mining and development companies in North America could offer an attractive, low-cost opportunity for Tesla." The analyst believes industry heavyweight Rockwood Holdings (NYSE:ROC) is "an obvious choice as a supplier" for the electric vehicle manufacturer. Why Nevada? According to The Wall Street Journal, Nevada won out over Arizona, California, New Mexico and Texas, the other states that were competing to host the plant. Tesla had been scouting locations in all five states, and each had been attempting to come up with an incentive package to lure in the electric vehicle manufacturer. The Journal states, "Nevada likely offered Tesla one of the largest incentive packages in the history of the U.S. auto industry to lure the factory to a state with relatively little presence in automotive manufacturing."