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

 Recent Developments

UK Foreign Affairs Committee launches inquiry into critical minerals: The UK’s Foreign Affairs Committee launched an inquiry on December 20 to consider how the country “can engage with global partners to diversify supply chains in a way that respects human rights and ensures adequate access to critical minerals.” The inquiry will examine how the Foreign, Commonwealth, and Development Office (FCDO) can leverage its diplomatic relations to “build strong alliances for global regulation of the critical minerals market,” and it will ask how the FCDO can ensure the UK’s access to critical minerals markets while promoting the country’s values through ESG performance in critical minerals and processing. Additionally, it will examine how the UK can build its supply chain resilience by diversifying its supply chain and if the country should utilize new methods of mining, and if they should regulate these new methods.

• The associated call for evidence asks for responses to seven questions, including what critical minerals are the most important to the UK’s national priorities, what opportunities are there for diversification, what opportunities and challenges are there of deep seabed mining, and what are the risks to international security of having midstream processing in a few countries, among others.
• The deadline for submitting written evidence is February 28, 2023.

France and Germany urge European Union to implement response to U.S. Inflation Reduction Act tax credits: France’s Economy and Finance Minister Bruno Le Maire and Germany’s Economy Minister Robert Habeck are advocating for the EU to approve “targeted subsidies and tax credits” for “key industrial sectors” in response to the U.S. Inflation Reduction Act (IRA), according to a joint-statement. Many European nations view the domestic requirements outlined in the IRA as too restrictive and make European-made goods less competitive with global rivals. In response, Minister Le Maire said the EU’s common goal is for it to “gain undisputable leadership on green industry. It is an economic as well as a political stake for European countries.” French and German ministers have plans to meet with President Biden in January to discuss the consequences of IRA.

• At the 2023 EU-U.S. Trade and Technology Council meeting, France and Germany plan to discuss an EU-U.S. agreement that requires mutual recognition of standards and access to subsidy programs.

S. Treasury Department delays release of proposed guidance on Inflation Reduction Act Electric Vehicle Tax Credits: Originally to take effect January 1, the U.S. Treasury Department is delayed releasing its proposed guidance on required sourcing of EV batteries until March, giving EVs that may not currently meet the new requirements a period of eligibility in 2023. While other tax credit requirements like income caps will still take place on January 1, the requirements contingent on the value percentage of critical minerals used in batteries originating in the U.S. or a country with a U.S.-free-trade agreement are still up for interpretation. The Treasury committed to releasing “information on the anticipated direction” of the requirements and said that “the critical mineral and battery component requirements take effect only after Treasury issues that proposed rule.”

Zimbabwe bans export of unprocessed lithium: Zimbabwe’s Minister of Mines and Mining Development, Winston Chitando, banned the exportation of unprocessed lithium under Section 3(1)(a) of the Base Minerals Export Control Act [Chapter 21:05]. The new order notes that “no lithium-bearing ores, or unbeneficiated lithium whatsoever, shall be exported from Zimbabwe to another country except under the written permit of the Minister…” The new ban aims to support the country’s economy by decreasing artisanal miners from illegally mining and exporting the mineral through neighboring countries.

• Notably, the ban does not apply to the exportation of lithium concentrates, which major lithium companies in the country are planning to produce.

New report shows South Korea is dependent on China for critical minerals used in batteries: According to a new report from the Korea Chamber of Commerce and Industry, South Korea has the highest import dependency ratio, at 77.1%, on China for critical minerals used in battery production, including cobalt, manganese, lithium, and nickel. South Korea is closely followed by Japan at 66.5%. Overall, China supplies 58.7% of South Korea’s battery minerals, a 23.1% increase from ten years ago. As a result, and in light of the U.S. Inflation Reduction Act regulations, South Korea is working to diversify its supply chain of critical minerals. Currently, approximately 15% of South Korea’s critical minerals are sourced from the U.S. or countries with a U.S. free-trade agreement.

First Nations in Canada are challenging mineral rights in British Columbia: First Nations are arguing the current free entry mineral claim system under the Mineral Tenure Act in Canada enables anyone to file a mineral claim without notifying or engaging the First Nations, breaching the Declaration on the Rights of Indigenous Peoples Act (DRIPA) and the United Nations Declaration on the Rights of Indigenous People (UNDRIP). The Gitxaala First Nation and Ehattesaht First Nation agreed to have their judicial reviews seen at the same time, which is scheduled for April 2023, on the grounds that free, prior, and informed consent must extend to mineral rights. The British Columbian Government is contesting the review.

• There have been seven mineral claims on First Nation territory, with two being withdrawn voluntarily, and the Gitxaala are advocating for the remaining five to be suspended and a temporary moratorium placed on First Nation territory, pending the results of the case. At its core, the Gitxaala argue the Mineral Tenure Act is a relic of colonization and must be reformed. Additionally, The Association of Mineral Exploration (AME), Mining Association of BC (MABC), and Prospectors and Developers Association of Canada (PDAC) are seeking intervenor status and are opposed to changing the free entry claim system while one junior exploration company is also seeking intervenor status in support of the Gitxaala.

Ecuador and China are close to closing free trade agreement: On December 14, Ecuadorian President Guillermo Lasso said its free trade agreement with China is “practically closed.” The deal is intended to create an additional $1 billion in exports to China and boost employment in Ecuador. In the past, China has been Ecuador’s main financial partner in crude oil delivery contracts, hydroelectric dams, and mining.

• Notably, the U.S. is also looking to expand trade relations with Ecuador after President Lasso’s visit to Washington D.C. on December 19. This year, China surpassed the U.S. as the country’s top trading partner on non-petroleum goods. When President Lasso took office last year, his main goal was to solidify trade agreements with other countries, especially the U.S.; however, for the past two years, President Biden has been focusing on economic recovery rather than entering new trade partnerships. Following Ecuador’s deal with China, many believe the U.S. should and will continue to strengthen trade ties with Ecuador.

 Looking Ahead

• Saudi Arabia’s Ministry of Industry and Mineral Resources is hosting the 2023 Future Minerals Forum in Riyadh, Saudi Arabia, on January 10-12: The event will focus on the global outlook and future of mining, regionally and worldwide, the sector’s critical role in the energy transition, contributions of mining to the development of societies, as well as mining opportunities in the Kingdom of Saudi Arabia and the wider region that stretches from Africa to Western and Central Asia.
• Mexico Business Events is hosting Mexico Mining Forum 2023 in Mexico City, Mexico, on February 1-3: The event will provide in-depth information about the Mexican mining industry, government priorities, and sustainable mining management.
• Hyve are hosting Mining Indaba in Cape Town, South Africa, on February 6-9: The event joins investors, financiers, operators, suppliers, and mining & exploration companies for four days of unrivaled deal-making opportunities, industry-leading discussions, and business-changing connections.
• Australia’s Mining Monthly and Mining Magazine is hosting Future of Mining Sydney in Sydney, Australia, on February 20-21: This event will provide opportunities to learn from, challenge and debate with the region’s pioneering innovators to address new solutions and shape strategies that advance the mining industry’s operational goals.
• Beacon Events is hosting Mines and Money Miami in Miami, Florida, on February 23-24: The event will look at key global trends, collaboration strategies, and the pathway toward the energy transition.
• Expogroup is hosting Minexpo Africa 2023 in Dar-es-Salaam, Tanzania, on February 23-25: The event will showcase the region’s latest technology in the mining & processing of minerals, earthmoving, safety equipment, and much more.
• The Society for Mining, Metallurgy, and Exploration (SME) is hosting MINEXCHANGE 2023 SME Annual Conference & Expo in Denver, Colorado, on February 26-March 1: The event will focus on new safety strategies, exiting advances in AI, and important initiatives for a sustainable future.
• The Prospectors & Developers Association of Canada is hosting PDAC in Toronto, Canada, on March 5-8: This event will attract up to 30,000 attendees from over 130+ countries to participate in educational programming, networking events, and outstanding business opportunities in the mining industry.

 In Case you Missed It

• E&E News: West Coast states unite to ban gasoline-powered cars by 2035
• E&E News: Lawmakers toss $300M lifeline to advanced nuclear
• Ghana Web: Production of lithium in large quantities can help Ghana’s fight against climate change – STRANEK-Africa
• Energy Storage News: EU body: Action needed now ‘to prevent outflow of investment’ from Europe’s battery ecosystem
• Reuters: Indonesia considers $320 mln in incentives to boost EV sales in 2023
• Nikkei Asia: EV battery maker LG Energy allots $3bn to boost South Korea plant
• E&E News: Postal Service rolls out big plan to electrify its fleet
• CNBC: Auto executives are less confident in EV adoption than they were a year ago
• The Jakarta Post: New mining rules lay groundwork for atomic aspirations
• Reuters: Uzbekistan starts shipping copper to Europe bypassing Russia
• Rice University – News and Media Relations, Office of Public Affairs: US must disconnect strategic supply chains from China, say Baker Institute experts
• Mining Weekly: AUSMESA to focus on mining skills
• E&E News: End of the line for permitting bill, but 2023 fight looms
• Bloomberg: Joe Manchin Meant to Make Electric Car Tax Credits Hard to Get
• Goldman Sachs: The U.S. and Europe Are Moving Toward Battery Self-Sufficiency
• Bloomberg: US ‘Battery Belt’ Widens With $3.5 Billion Redwood Materials Plant

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