Sniffing out Kent Moors’ “OBL Superfuel” — What’s the White Gold “1,693X more powerful than gasoline?”

What's Energy Advantage selling in their "Roadmap for the OBL Revolution?"

By Travis Johnson, Stock Gumshoe, April 12, 2017

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’s where much of the investment excitement comes in (though graphite projects get hyped up from time to time as well, including the fairly recent “Pure Carbon” teaser about Leading Edge Materials from Gerardo Del Real).

Things have actually slowed down in the lithium-hype space this year, partly because cobalt has been a more exciting story in recent months, and partly because there have been so very many investment themes for investors to get crazy about since the election that the lithium story has kind of gotten buried in the noise. But the basic facts of the increasing lithium demand are still roughly the same… so which “OBL” stock is Kent Moors turning our attention to today?

“… the price of OBL has doubled TWICE in the past 14 months.

“But almost nobody knows about it… yet.

“And it just so happens that one little miner, led by the most successful management team I’ve ever seen, could dominate this soaring market…

“Because they found a treasure trove of this rare substance – not high up in the Andes Mountains… but right here in America.

“This $92 million miner recently acquired what could soon be considered the most valuable piece of land in the world.”

That land is “in a windswept plane at the foot of the Sierra Nevada mountains,” apparently, and Moors says the prospects there are huge…

“This company’s own ‘blind’ estimates suggest the property’s reserves could approach 816,000 metric tons.

“The U.S. Geological Survey (USGS) has recently conducted no fewer than four studies in the region confirming this superfuel is there.

“And at $25,000 per metric ton…

“We could be looking at a $20.4 billion OBL treasure trove!

“It’s literally beginning to burst out of the ground.

“And it’s all controlled by this tiny $92 million company.

“Right now, this soon-to-be energy titan is building a facility to mine their OBL find….

“But if you wait until they put even one speck of OBL onto a train or 18-wheeler, you risk missing your chance at the kind of payday investors normally only dream about.

“Now, nothing in the market is guaranteed, and this is a small stock.

“In fact, shares are only trading for about $1.50 – literally pocket change!”

And, as is always required for a good teaser pitch, there’s some urgency:

“I’m expecting a major announcement that will send this stock to the moon, and enrich savvy investors.

“As we speak, this firm is rushing to complete an important study that will confirm exactly how much OBL can be mined in the seven deposits under its newly acquired property.

“I believe the results will be announced within the next three months.

“Possibly within the next few weeks.”

This is all starting to sound quite familiar. Ring a bell, anyone?

How about now:

“And for years now, members of the “dream team” behind this small firm have been repeatedly making early investors a fortune in similar ventures.

“They are quite possibly the most successful resource team in modern history.”

“The executive chairman is an entrepreneur, geochemist, and geologist with over 35 years in the mining industry….

“And with this OBL venture, he’s teamed up with one of the world’s most successful commodities billionaires.

“Another energy mogul with an incredible track record.”

So yes… this is a repeat of the teaser recommendation that Dr. Kent Moors was circulating last year. Remember that one? Back in November, Moors pitched this same lithium stock with an attention getting “Say No To Lithium Stocks” headline… this is, again, hinting at Lithium X (LIX.V, LIXXF).

And he buried the lead a bit here in this ad — Lithium X does indeed have some exploration properties surrounding Albemarle’s producing lithium brine facility in Nevada — it’s not technically in “Death Valley”, as far as I know, but it’s not all that different a place, and Death Valley National Park in California is only about 150 miles away.

But Lithium X’s much more valuable property, I would argue, is their project in the Andes in South America, the neighborhood where you’ll find most of the world’s current lithium production (and nearly all of its lithium brine production). Here’s how Moors touts that asset, further down in the ad:

“Up to this point, I’ve only told you about this miner’s discovery in the United States.

“But they have just secured another massive property that is bursting with OBL.

“And it’s located far away, where the “White Gold” story first began…the Andes Mountains.

“Nestled between two areas menacingly known as Dead Man’s Lake and Little Devil’s Flats lies 20,000 acres of OBL-rich land.

“So this miner’s new discovery is bigger than the one they are also developing near Death Valley.

“It also contains more OBL.

“According to a recent survey, this chunk of land holds over 2.8 million metric tons of this superfuel.”

The challenge, as with all of the emerging lithium producers, is that it’s hard to predict just what will happen to lithium pricing… and actually building brine ponds and developing production and hiring workers and shipping stuff is a lot more problem-prone than just dreaming of the potential of lithium-rich brines underground and watching your stock spike on the lithium “story.”

So perhaps it’s good that most of the lithium exploration names have come back to earth a bit and gotten a bit more rational, and the actual producers like SQM (SQM) and Albemarle (ALB) have taken their turn to rise in price on the back of their existing and expanding production and higher lithium prices (and, of course, more visibility for lithium stocks).

What, then, is the story now? Well, part of the reason that Lithium X is down a bit is that it has become a bit more obvious that they’re a long way from production — they still don’t have a feasibility study, and they formally reiterated back in February that their 2011 preliminary economic assessment should not be relied on, at the same time that they were raising another $15 million to continue their exploration and initial “test production” work (they are starting not with a feasibility study, it appears, but with a test facility that will produce at a small scale — this is mostly being funded by their JV partner in Argentina, but Lithium X will participate as well).

There will probably be news coming fairly soon, since Lithium X is focusing on upgrading its resources this year with an exploration program, and the test facility will presumably demonstrate that the project can be roughly as profitable as other similarly-situated projects in the Andes, though these things always take longer and cost more than expected.

So my opinion about Lithium X still stands — if we assume, in the absence of more information, that the older resource information about their Sal De Los Angeles project is at all accurate, then the valuation is relatively in line with some other past emerging producers like Orocobre, so it’s probably not as crazy as one might expect for a heavily promoted junior lithium explorer following a huge move in the price of lithium carbonate. This is what I wrote back in November when I was investigating Moors’ tease:

“Lithium X is not as crazily valued as I might have guessed, given the actual potential of their Argentinean project, but it’s years away from real production and I’m not very impressed by anyone’s Nevada lithium projects, including those of Lithium X. This would be one of the first lithium juniors I’d consider, but there is plenty of lithium that can be produced if prices stay up in this area so there’s no real guarantee that lithium prices will be permanently much higher in five or ten years… and risks are quite a bit lower (and valuations higher) with established producers like Albemarle or even emerging producers like Orocobre. I don’t own any lithium names right now.”

And, well, that’s still how I feel. Lithium X is more appealing than most of the really tiny juniors I’ve seen, partly because they have some experienced management, and the backing of Frank Giustra (which always draws investor attention), and have at least a test project underway on their most promising property.

But you can also keep it simple… if you want exposure to lithium doubling in price again a few more times, as is possible but certainly not guaranteed, I’d still feel much better about buying the high-quality companies who are producing it profitably now and are able to expand production, which is generally much easier and faster than building a brand new production facility.

And this is perhaps a cynical view, but I still don’t see much reason to waste time with juniors who are trying to develop US production in Nevada — if Albemarle wanted to expand their production dramatically in Nevada, where they’ve had a facility for a very long time, they could have invested in expansion there many times over the years, and could also have easily bought out some of these little players that surround their Silver Peak operation… and they haven’t done either, to my knowledge.

Why? My guess would be that’s because they know that expanding production in South America (where most of their lithium comes from) is far more profitable. The primary reason to think about Nevada lithium production is if you believe Elon Musk was issuing an incontrovertible promise when he said he was going to only buy “local” raw materials a few years ago while he was being a showman for his Gigafactory… he probably will buy some of his lithium from US producers, I imagine, but only if they are similar in cost to the lithium he can buy from the world’s major producers in South America and Australia. If the prices are similar, then the production capacity and the mature operations mean the South Americans, from what I can tell, are going to make a lot more money than the Nevadans. That might include Lithium X if they can get their Argentina project built and up to capacity over the next five or ten years, but it’s going to take some time and patience.

That’s just my opinion and assessment, though, and I’m certainly not an expert on lithium production — so I may be missing some gem of information or suffering under some sort of bias that blinds me to the value of some of these assets. I’d be delighted to hear from those who disagree with me, just shout out your thoughts with a comment below.


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199 Comments on "Sniffing out Kent Moors’ “OBL Superfuel” — What’s the White Gold “1,693X more powerful than gasoline?”"

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H. Thompson
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On top of all that, apparently Dr. Moors doesn’t know the difference between a “plane” and a “plain” … that is, if you have quoted his pitch correctly!

john
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WAIT!! this is a money back ! guarantee !

David Underdown
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Personally think ‘Dr ‘ Moors should be the ringmaster in a circus.
His spiel is all fluff and bubbles and he gives you a teaser for a low cost entry level subscription into one of his plethora of articles, and then tries to up sell to much more expensive options.
Also I would question his supposed background in Intelligence, Vietnam etc.

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Jonathan
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Oh boy, I bailed out of Lithium X a while ago during the lithium mini-bubble for a modest profit. I’m doubly pleased now that it’s got the “Dr. Kent Moors Seal of Death” on it.

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Andrew
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not so sure about this one, prefer to look at molybdenum and Niobium, plenty of scope in China miners http://eqibeat.com/top-20-asian-mining-stocks-by-market-cap/

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vivian
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the big Li producer in exotic South American terrain is Soquimich (NYSE-SQM) in the Atacama Desert which our writer Frida Ghitis tracked out to see (or climbed up to see–it is on a peak.) another is an obscure Australian company whose main accessible listing is in Canada which mines in … Jujuy, a province of Argentina

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Nils Mellquist
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ALB, FMC and SQM are the big three and the only one a car OEM supplier would do a deal with. These juniors are jokers.

Daniel Miller
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Contact Me
CEO of Eco-Tech 4 Solutions
Daniel.miller@e-t4s.com

Nils Mellquist
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Neo Lithium much better management and assets. Travis, you do a great job of unpacking the garbage and formulaic pitches of these snake oil salesmen. I feel bad for the sucker retail investors that whip out their credit cards. This is all balderdash. And these “experts” talk out of both sides of their mouths: perfect market timing track record (yeah right) so they’ll tell you when to get out. Meanwhile, the world’s a disaster so stockpile silver bracelets, gold trinkets, physical gold, bitcoin, navy seal rations, extra water, guns, ammo, duck tape and a safe farm to flee to as… Read more »
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Deep Blue
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Thanks for the reality check.

Carbon Bigfoot
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Sounds like the efficiency reaches Warp Factor 9.9 of the Starship Voyager. But they need to mine DILITHIUM crystals on an asteroid just to get home from the Delta Quadrant. Lots of luck

Paul Reardon
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“The needs of the many out way the needs of the few or the one” I have to admit I got sucked into this junk for about 3 minutes, when he started saying 1233% I started to chuckle and the more I heard the more I laughed. Moore became more of a comedian than a snake oil salesman! Anyway, I started looking into this white gold and found Travis’s article to be more what I thought this was. After searching out several of the Lithium players it all proved to be crap! Thanks Travis, nice work!
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tony
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Ok I read this spiel and could not figure out where the name of the company that does the mining . Let me guess he sells you that?

Oscar Mostofi
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What is the name of the company??

Deep Blue
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Apparently it’s Lithium X.

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askforinfo
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I look at it this way, Tesla has begun production of lithium batteries at their huge new Nevada factory. A recent political development in Nevada suggests that the state is about to double down on lithium batteries and electric cars, which will enhance Tesla’s lithium supply. “Tesla’s lithium supply chain is about to receive wave of support from the Nevada Legislature.” Tesla gained substantial subsidies and other inducements from Nevada to locate their battery factory east of Reno. One inducement was a curious road extension connecting Tesla’s GigaFactory to US Highway 50, otherwise known as “The Loneliest Road in America”.… Read more »
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Poncho
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I almost got suckered in to buying the report. I am glad to have found this article by googling it. Thank you every one who giving me the light of the day. Please keep giving these value information to those of us who need more education.

Sal
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Yes, the White Gold nonsense is just that. As far as Tesla is concerned, electric cars are not any breakthrough. When the other car companies start producing electric cars cheaper than Tesla can, the stock bubble will burst. Historically, car companies trade at low valuations. Tesla’s stratospheric valuation is absurd.
I can’t predict when the stock price will fall…..but those shorting it at that time will make much money

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CherieA
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Do you work for Tesla?

Steve
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Lithium is too expensive, limited capacity, hazardous, slow to recharge. It was John Goodenough who co-invented the lithium-ion battery in 1970’s around the ripe old age of 50-somthing, pushing NiCad batteries aside to the alleyways of battery tech. And guess what, lithium stock lovers—Goodenough, now in his mid-90’s, has just put the lithium -ion battery on it’s way to obsolescence, too. Here’s a story on Goodenough’s new glass battery technology: https://news.utexas.edu/2017/02/28/goodenough-introduces-new-battery-technology With such a discovery, I wouldn’t go into lithium stocks except for short-term gains. In due time Goodenough’s (or someone else’s) battery technology will take all the wind out… Read more »
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CherieA
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I would hope for something better than the Lithium battery. It’s absurd to put ones faith in a battery this bad. For years I have wondered who was really behind using these batteries.

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G. Funk
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More Corporate Lie’s ! To get money from the not so rich ! to fill there pockets why ? Cant people just be honest.

Victory
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BECAUSE BEING HONEST DOESN’T MAKE ENOUGH $$$$ ,,,

Normally Dubious
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Other than Bill Patalon’s Private Briefing with its occasional good tip, I’m considering clicking Unsubscribe to everything else Money Map Press.

I’ve already held Lixxf with no particular long term profit.

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Glenn Henderson
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Dont miss the futures here. If ev cars production globally to 40% of all cars you just got stupid here on these negative comments. The big 3 cant keep up with present growth. Lixxf is the best buy to bet on long. Orocobre also and pure energy. Buy those 3 go long….

Daniel
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So, is there any rational way to compare the “power” of lithium to that of gasoline?

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JMW
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I’m with you. They are missing the boat.

Paul Butler
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Interesting but the Lithium Ion battery has a limited shelf life with the new glass batteries created by the inventor of the Lithium battery. This is something to invest in.

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Dane
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Here is Money Morning’s pitch: “Just one gallon of OBL fuel could power a car on a round-trip between New York City and Los Angeles seven times.” https://moneymorning.com/2017/04/19/oro-blanco-fuel-could-have-nearly-unlimited-profit-potential-for-investors/ Making it seem like a consumable fuel that has incredible energy density. Rechargeable batteries do not consume fuel; the raw materials that go into them are not measured in “gallons;” and even a Tesla Model S with the premium 85 kWh battery would have to stop and recharge ten times on a trip from NYC to LA. If “OBL fuel” is simply lithium raw material that goes into rechargeable batteries, Money Morning’s… Read more »
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andy
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Perhaps Dr. Kent Moors should take some lithium to calm down.

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Poncho
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Well, he is a snake oil salesman. I almost buy his report if I didn’t fine this article before I decide to.

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gridflash
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The Sal De Los Angeles is the real deal. Clayton Valley is just for marketing.

OBL
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What a crock

Peter
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Sounds fantastic, but what about the “emissions” from burning OBL? The ‘scuttlebutt’is that the fumes from OBL are highly toxic, poisonous, much more so then gasoline. any truth to this?

Arnold Walker
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The only way that lithium could 1693X more power than gasoline. Is the other use not mentioned….it used in molten metal reactors fueled with thorium.

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