Critical Minerals: What’s On & What’s Next

 Recent Developments

U.S. Department of Energy investigation finds lack of oversight led to American battery technology in China: A recent U.S. Department of Energy investigation examining how vanadium redox flow battery technology developed at the Pacific Northwest National Laboratory (PNNL) found its way to China concluded that high staff turnover and an inadequate record-keeping system stopped PNNL from tracking a company that licensed the lab’s battery technology. Additionally, PNNL was overly lenient when the company was under financial stress, according to a summary of the report provided to E&E News.

• This formal investigation follows an August 3 NPR investigation covering the topic and a subsequent letter from U.S. Senators John Barrasso (R-WY) and Joni Ernst (R-IA) requesting that Department of Energy Inspector General Teri Donaldson answer questions “on a report showing DOE illegally sent $15 million of taxpayer-funded advanced battery technology to Communist China.”

Australia releases its 2022-2023 budget, with key components for critical minerals: Australia released its budget for 2022-2023 on October 25. The new budget includes the development of a new National Critical Minerals Strategy in consultation with industry and community stakeholders. The new strategy would complement the current National Battery Strategy and the Electric Vehicle Strategy and will focus on expanding Australia’s mining science technology capabilities, diversifying its supply chains, creating jobs, and driving the critical minerals sector’s growth, according to Prime Minister Anthony Albanes.

• Specifically, the budget includes A$50.5-million to establish the Australian Critical Minerals Research and Development Hub over four years. The hub will include Geoscience Australia, the Commonwealth Scientific and Industrial Research Organization (CSIRO), and the Australian Nuclear Science and Technology Organization, and will work with the country’s critical minerals industry to address current challenges and support research and collaboration.
• Lastly, the government will allocate A$50 million “over three years to the Critical Minerals Development Program for competitive grants to support early and mid-stage critical minerals projects, building on the $50 million recently committed to six key projects across Australia.”

Namibia and the European Union reach provisional rare earth minerals deal: Namibia has reached a provisional deal with the European Union (EU) to sell its rare earth minerals to the EU, according to Namibia’s Minister of Mines and Energy Tom Alweendo on October 20. While details on the deal are scarce, Alweendo noted they have agreed on conditions, and no matter what materials are sold, they will be processed in Namibia to ensure the country benefits from the resources.

Chile close to a decision on raising mining royalties: Chilean Mining Minister Marcela Hernando announced on October 25 that the Ministry of Mining and the Ministry of Finance are close to reaching a consensus on how much to raise royalties in the mining sector. Chile plans to raise royalties to the levels seen in OECD countries to remain competitive and gain more revenues for the country.

• Mining Minister Marcela Hernando also said the country was looking for a business partner with environmentally friendly technology to extract lithium to support the establishment of a national lithium company.

The Biden administration pressures Nicaragua’s mining industry: United States President Joe Biden issued an “Executive Order (EO) on Taking Additional Steps to Address the National Emergency With Respect to the Situation in Nicaragua” on October 24. The EO aims to target Nicaraguan President Daniel Ortega’s actions on democratic actors and members of civil society, unjust detention of political prisoners, and support of Russia’s military and its invasion of Ukraine, according to a statement from Brian Nelson, U.S. Under Secretary of the Treasury for Terrorism and Financial Intelligence. Notably, the EO enables the U.S. to sanction Nicaragua’s businesses, including its gold mining industry, and restrict investment in certain sectors in Nicaragua, the importation of certain products to the U.S., and the exportation of certain items to Nicaragua.

• Additionally, the Treasury Department designated the Nicaraguan mining authority General Directorate of Mines because it manages most mining operations on behalf of the government and is “an important piece of the state-controlled gold operations in Nicaragua.”
• This development follows the Treasury Department designating the state-owned Nicaraguan mining company Empresa Nicaraguense de Minas and an official of the Government of Nicaragua pursuant to Executive Order 13851 on June 17, 2022.

Ecuador residents seeking referendum to ban mining in the Choco Andino forest: Residents garnered over 380,000 signatures of the 200,000 required to hold a referendum on banning mining in the Choco Andino forest, citing threats to water sources, nature, and their local businesses. There are currently six gold-mining concessions in the forest available, and the government has already handed out 12 concessions which would not be affected by the referendum. Notably, Ecuador’s President Guillermo Lasso recently said the mining sector would boost the country’s economy with a projected $3 billion in exports this year. The residents hope the referendum is held in February 2023 after the country’s electoral court verifies the signatures.

• The forest, which spans roughly 690,000 acres, was declared a biosphere by UNESCO in 2018 and features 12% of the country’s plant varieties and significant biodiversity.

Mexican President to speak with U.S. climate envoy about the automotive and lithium industry: Mexican President Andres Manuel Lopez Obrador and U.S. climate envoy John Kerry will discuss lithium, batteries, and the automotive industry on October 28. The talks will focus on Mexico’s Sonora Plan, which is a part of the state’s transition to a green energy hub, solar farms, and the production of lithium. As part of the Sonora Plan, the Mexican government plans to increase EV sales from 5 percent today to 50 percent by 2030.

Australia and Japan announce partnership on critical minerals: Australia and Japan signed a partnership on building secure supply chains for critical minerals on October 22. The new Critical Minerals Partnership will “establish a framework for building secure critical minerals supply chains between Australia and Japan, and promote opportunities for information sharing and collaboration, including research, investment and commercial arrangements between Japan and Australian projects,” according to a media release from the Prime Minister of Australia. Additionally, the partnership will support the further development of Australia’s critical minerals while ensuring Japan has the necessary critical minerals for its manufacturing sector.

Wood Mackenzie releases report on copper’s role in achieving net zero: Global Research and Consultancy Group Wood Mackenzie released a new report titled, “Red metal, green demand Copper’s critical role in achieving net zero,” last week modeling future copper demand. The report focuses on copper’s role in building and connecting batteries, motors, and electrical networks that will be critical for the energy transition. Notably, it found that to achieve net zero targets, the mining industry would have to develop new projects faster than ever before. This would include 9.7 Mt of supply over the next ten years, investing more than $23 billion a year.

• Additionally, while recycling copper could help meet future demand, it will not be the entire solution. That being said, with new investments in sorting and using scrap and an emphasis on lower carbon emissions, consumer-led preference for secondary scrap could act as an investment catalyst, according to the report.

Automakers discuss the electric vehicle tax credits under the Inflation Reduction Act: Currently, the IRA requires automakers to have 50 percent of critical minerals used in EVs be sourced from North America or U.S. allies by 2024, rising to 80 percent by 2026 to qualify for federal tax incentives. However, several automakers have said they cannot realistically comply with this timeline and are asking for an extension to 2030 to complete the transition. However, this is not the case for all EV auto manufacturers, and some have said they will meet the requirements within a few years.

• Additionally, in response to the Inflation Reduction Act, Canada’s Finance Minister Chrystia Freel said there are elements in the bill that Canada needs to respond to, which we will see in its fall economic statement and spring budget.

 Looking Ahead

• Beacon Events is hosting its International Mining and Resources Conference and Expo in Sydney, Australia, on November 2-4: This event will bring together more than 450 mining leaders and resource experts throughout six conferences covering the entire mining value chain.
• Nevada Mining Association is hosting Mining into the Future in, Nevada, on November 3: This event will cover topics including sustainability, digital transformation, and upskilling the workforce.
• Benchmark Mineral Intelligence is hosting Benchmark Week 2022 in Los Angeles, California, on November 14-18: This event will focus on EV outlooks, lithium-ion gigafactories, and critical minerals including lithium, cobalt, nickel, graphite, and manganese.
• Beacon Events is hosting Mines and Money London in London, United Kingdom, on November 29 – December 1: The event will look at the energy transition, ESG, sustainability, and the circular economy.
• The American Exploration & Mining Association is hosting its 128th Annual Meeting: Secure Supply Chains Start with Us in Sparks, Nevada, on December 4-9: The event is the second largest and longest-running annual mining convention in the U.S. and will feature over 100 speakers and 250 exhibitors.
• Deutsche Bank Securities is hosting the 7th Annual Lithium and Battery Supply Chain Conference in New York City, New York, on December 7: The event will include presentations and one-on-one/group meetings with senior executives from the leading lithium producers, battery manufacturers, diversified lithium recycling, consultants, and rare earth producing companies.
• Beacon Events is hosting Mines and Money Online Connect on January 24-26: The event will focus on bringing together miners, investors, financiers, and industry professionals to network, hear market analysis, compare investment opportunities, share knowledge, discuss, debate, and conduct business virtually.

 In Case you Missed It

• S&P Global: Lithium set for correction amid supply growth in recessionary climate: FT event participants
• Reuters: Analysis: Biden’s EV minerals cash fruitless without permitting reform
• Reuters: Albemarle to stay in Europe if lithium declared hazardous by EU, CEO says
• CBC: Canadian minister in Washington: We need to decouple from China
• Australian Financial Review: Australian firms win slice of Biden’s $4.5b critical minerals grants
• Reuters: EXCLUSIVE Automakers to double spending on EVs, batteries to $1.2 trillion by 2030
• E&E News: What Biden’s $2.8B EV battery boost means for jobs
• S&P Global: West seeks to ‘regionalize’ metals supply but won’t easily by-pass China: LME seminar
• CNBC: South Korea, U.S. in ‘intense conversation’ over EV tax credits, ambassador says
• Automotive News: U.S. mining needs major boost to meet surging EV demand
• Reuters: Germany to spend 6.3 bln euros on push for electric car charging points
• Mining Weekly: World’s largest AEM survey completed in WA
• South China Morning Post: Hurdles in supply chain remain as US raises its ‘Buy American’ threshold for government purchases
• France 24: Europe joins the ‘white gold’ rush for lithium and faces an energy transition challenge
• GreenBiz: Clean up mining, while addressing an undersupply of energy transition minerals
• E&E News: GAO: Feds need to boost EV buying to meet Biden’s goals
• Canada’s National Observer: Climate change raises risks for mining industry
• Reuters: French lithium mine project could be leading supplier in electric car strategy
• Macau Business: Portugal: PM Costa announces joint energy store in Iberia

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