The current lithium frenzy will end badly while gold bugs should look at the riper opportunities available in copper and platinum, according to mining financier Robert Friedland.
In a sprawling, exuberant and at times politically incorrect speech at the Mines and Money Americas conference in Toronto, the veteran promoter demonstrated he hasn't lost his sales mojo as he ticked off all the reasons why the properties owned by his Ivanhoe Mines Ltd. just happen to be ideally positioned for the next wave of automotive technology.
"I'm not here to depress the gold bugs in the room, but to get you excited about copper and other metals that we need in our new society," he said as he accepted a lifetime achievement award.
Mr. Friedland made his first fortune with the Voisey's Bay nickel deposit in Labrador, which he sold to Inco for $3.4-billion in 1996. Later, he oversaw discovery of the massive Oyu Tolgoi copper deposit in Mongolia, now controlled by Rio Tinto PLC.
He launched Ivanhoe Mines in 2000 and continues to serve as chairman of the Vancouver-based company, which is developing properties that include the Platreef platinum and palladium project in South Africa and the Kamoa copper project in the Democratic Republic of the Congo.
Slipping into a mock Indian or Australian accent at times, Mr. Friedland told his audience that the world's population is becoming increasingly urbanized.
"As people move to cities, they get sick" from toxic smog, he said. He cited one estimate that 6.5 million people a year die from air pollution.
As a result, there will be continuing pressure to find less polluting ways to power vehicles. Fuel cells, which employ a platinum catalyst to combine hydrogen and oxygen, are likely to become one of the chosen technologies, especially for large vehicles that must be able to travel long distances, he argued.
"This is seriously important to the precious-metals business," he said. A typical fuel-cell-powered car might use an ounce of platinum.
The next generation of cars such as the Tesla Model 3 will also require large amounts of copper because of the metal's use in high-efficiency induction motors, he predicted.
However, many of the new cars will no longer need rare earths, a group of elements used in many consumer electronics, he stressed.
Chinese suppliers have dominated the production of rare earths in recent years and have been accused of driving up prices, but "don't worry about the Chinese squeezing our testicles," he said. "We don't need them any more."
Neither, he said, will the world need as much lithium as many projections declare. "I think most lithium mines are also going to end in tears," he predicted, as fuel cells prove to be superior to lithium ion batteries for many applications.