Nickel isn’t considered a ‘sexy,’ topic, but it should be. It’s a huge reason for the existence of technologies like your phone and laptop, for modern home appliances, health care equipment, heads of golf clubs, and your beloved Tesla.
Its biggest driver of demand comes from the stainless steel industry, which accounts for most of its use, followed by electric vehicles. It is also used in security and defense applications. In fact, the Federal Government added nickel to the US critical minerals list in 2020, and the Title III of the Defense Production Act of 1950, has been amended, to include nickel as “essential to the national defense.” So safe to say, it’s kind of important.
The Department of Energy has stated that nickel is one of the most critical metals for an electrical energy transition. However, the US has a critically low level of available domestic nickel. This could be a problem, or an opportunity. Given the need for nickel across industries is only growing, we simply need more. And it just so happens there’s a nickel exploration company that’s been growing and working quietly under the radar, that could be the answer.
The US Dream Team: Jeff Bezos, Bill Gates and Alaska Energy Metals
Alaska Energy Metals, headed by ex-INCO, the 20th century’s largest nickel producer in the world, has ambitious plans to supply a steady amount of domestic nickel to the US to secure its energy future. Last Fall, it calculated its first maiden Mineral Resource Estimate (MRE), which is used to define ore tonnage and grade of a geological deposit (think quality and quantity), and it concluded some strong results.
The MRE exceeded 1.5 billion pounds (or 750,000 tons) of contained nickel for Alaska Energy Metals’, Nikolai nickel project, which is substantial. And now that the company has additional results to calculate yet another estimate it is anticipated that the nickel resource will roughly double the metal inventory. All that to say, this is a huge amount of nickel!
Just to put things into further perspective, Alaska Energy Metals was just recently joined by Bill Gates and Jeff Bezos’ Kobold Metals in Alaska’s Nickel Rush. The projects are right next door to one another, but Kobold is private so you can’t invest, whereas Alaska Energy Metals is a public company (TSX-V: AEMC), and so you can.
This just goes to show that Alaska Energy Metals knows where the opportunity lies.
What you may not know is that the US currently imports 100% of its nickel and it has only one nickel mine left, the Eagle Mine, which is set to sunset in 2027. Production from this one mine is exported to Canada to be processed. Much of the nickel sourced is from non-free trade countries which means, just like that, the US could be stripped of nickel supply. You can read more about this here.
Benefits of Made-in-America Nickel
A domestic supply of nickel would:
- Greatly reduce reliance on not-so-friendly countries,
- Ensure a stable supply
- Reduce future price fluctuations
- Help automakers and consumers benefit from the newly introduced Inflation Reduction Act, and more.
The Inflation Reduction Act, which was created in 2022, requires that an increased percentage of EV battery supply chain activities take place in North America in order to qualify for certain tax credits. Both as a way to reduce inflation and reliance on non-free trade countries.
On average, every electric vehicle battery needs 29kg (64 pounds) of nickel. To produce and supply nickel ‘at home’ is a huge win all around. And not only for electric vehicles but for all the other industries mentioned at the start of this article.
Nickel to Reduce Increasing Global Temperatures
Nickel is vital to a more macro movement.
With the energy source expansion we are currently working towards, which includes everything from the use of fossil fuels to solar and wind, nickel could help offset an increase in global temperatures.
There are many contributors to climate change, but the transportation sector generates the largest share of greenhouse gas emissions in the US and generates about a fourth of global carbon dioxide emissions.
In order to reduce its impact, we need to speedily replace gas-guzzlers with decarbonized transportation, in the form of electric vehicles. And in order to do this, we need nickel (alongside graphite, lithium, manganese, and cobalt) to create electric vehicle batteries. Without it, we cannot mass produce EVs in record time, which means we cannot decarbonize transportation, and ultimately, that means we cannot press the brakes on the pace of increasing global temperatures.
Alaska Energy Metals is racing against the clock. It has made a significant amount of progress in its exploration of nickel, and its CEO, Gregory Beischer, is confident that its deposit(s) could quickly evolve into potentially one of the larger nickel resources on the US. Something right about now, we so desperately need.