Electric car war sends lithium prices sky high

This is where the lithium oligopoly ends. It's where new entrants to the lithium mining game step in to forge a very lucrative future.

Right now, lithium isn't even traded as a commodity; rather, it is managed through an oligopoly of three or four major global suppliers who have managed supply and demand for decades. That's why everything is priced on a contract basis.

This year could see that change, which makes it a prime time to get in on lithium.

"The few major suppliers who have so far been responsible for all lithium supply and demand are not going to be able to meet new demand. This is why 2016 will be a very interesting year for anyone with the foresight to see the end of this oligopoly and the potential decoupling of lithium from other commodities," Dr. Andy Robinson, COO of Pure Energy Minerals (OTMKTS:HMGLF), told Oilprice.com.

Producers are now working quickly to stake their claims and position themselves strategically to become key suppliers.

So far, so good. Pure Energy, for one, is the only player in Nevada that has managed a conditional agreement with a company building the world's largest battery factory, which is located only four hours from Pure Energy's proposed mine.

There has been other movement in this space as well--broader, global movement that gives us even more reason to be bullish on lithium.

The fourth quarter of 2015 and the beginning of this year have seen a lot of talk about Australia's mining giant Rio Tinto considering entering the hot lithium space.

A Major Long-Term Game

This is an energy revolution that is still in its early days, but it's such a hot commodity right now that chances to get in on the long-term game are narrowing by the day. And Nevada - ground zero in this revolution - is already raking in the benefits because it is the only U.S. state that both produces lithium and holds vast new resource potential.

In 2013 alone, Nevada doubled lithium production capacity, according to the USGS--and that is just the tip of the iceberg given all of the new exploration going on and the fast and furious land-grabbing.

The next wave of battery factories are expected to increase global battery capacity by some 150% by 2020. Within this prediction, electric vehicles will have a projected 20-30% compounded annual growth rate through 2025, so the demand for lithium appears endless.