Another day, another crazy hyped-up pitch from Dr. Kent Moors — this time, he’s advertising his “entry level” Energy Advantage newsletter with a promise that he has found a way to profit from a “breakthrough superfuel.”
So what’s the story? Well, let’s start you out with a look at the headline:
“This Breakthrough ‘Superfuel’ is 1,693X More Powerful Than Gasoline
“Unearthed in the Andes Mountains, these mysterious crystals contain what MIT researchers call energy’s ‘Holy Grail.’
“And they could ignite a $7.2 trillion economic revolution!”
And he refers throughout to this “OBL” fuel, which is a term he made up to make it sound like it’s a mysterious thing that you couldn’t possibly understand without his assistance… that’s somehow an acronym for “Oro Blanco”, a reference to the white crystal structure of this “fuel”.
Which means, if you’ve been paying attention to natural resources investing at all over the past few years, that you probably already know the basics of what he’s talking about — this is another pitch for a lithium stock, though he persists in using that “OBL” term throughout.
And if you haven’t been around these parts for a while, well, this is what we do: We check out the wild promise in the ads from these newsletter pitchmen, then we sift through the clues and figure out what stock they’re referring to so you can do a little thinking for yourself, without the pressure of the sales pitch.
Lithium Carbonate is indeed a hot commodity these days, mostly because, in addition to being traditionally used for lots of ceramic and glass applications, it is a major component in lithium-ion batteries… and, as we are all quite aware, the lithium battery market is booming. No longer are we just using lithium-ion batteries for our laptops and iPhones, now they’re also powering full size, high powered electric cars like the Tesla Model S.
That increased demand from electric cars is part of the reason for the dramatic investment over the past few years in expanding battery production capacity around the world, most visibly with Tesla’s heavily promoted Gigafactory in Nevada, but also in China and South Korea, where much of the pre-Tesla production capacity existed, and, probably a bit later, in Europe, where there are some gigafactory-size ambitions in Sweden and Eastern Europe.
So it’s not at all a surprise that battery production is going to ramp up considerably, or that this kind of demand increase will require a supply increase for the components that go into lithium-ion batteries. For the most part, that’s graphite, cobalt, and lithium — and while none are particularly rare, cobalt and lithium are relatively concentrated in a few parts of the world and are somewhat difficult and time consuming to produce, so that’