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

 Recent Developments

• Included below are key developments from this week’s Prospectors & Developers Association of Canada (PDAC) Convention in Toronto, Canada: With almost 24,000 attendees, PDAC focused on critical minerals this year. Overall, three themes permeated many panel events during the conference. First, consultation with First Nations in Canada and other indigenous tribes/groups throughout the world is critical to ensuring a just energy transition. Second, Canada has a critical role to play in supplying the minerals needed for the energy transition but must remain competitive. Lastly, the mining industry must address its historic impacts and utilize best practices to protect the environment and uphold social standards, including by decarbonizing its entire supply chain.
  • Canada makes significant announcements over the convention: Over four days, Canada made significant announcements to support its critical minerals industry and collaborate with key stakeholders. Specifically, Minister of Natural Resources Jonathan Wilkinson announced:
  • “Over $344 million for five new programs and initiatives under the Canadian Critical Minerals Strategy and over $14 million for six projects under the Critical Minerals Research, Development and Demonstration program;”
  • “Over $700,000 in funding to the BC First Nations Energy and Mining Council through the Indigenous Natural Resource Partnerships program for its critical minerals literacy project;”
  • “An update on federal initiatives to improve regulatory processes for major projects in order to establish Canada as the global supplier of choice for clean energy in a net-zero world;”
  • “A deepening collaboration between Canada and the United Kingdom on critical minerals supply chain through a joint statement” that will leverage their strengths, create an integrated supply chain, and drive higher ESG performance;
  • Collaboration with indigenous representatives on international investment, economic prosperity, and a values-driven approach to supporting direct foreign investment for Indigenous communities and industries, participants at the International Mines Ministers Summit, key stakeholders during the Canada Investment Forum, industry leaders on environmental sustainability in the mining sector, representatives from the provinces and territories, the U.K., Australia, private companies, and many others, and Japanese battery supply chain companies to promote investments in Canada.
  • South American countries to work together to coordinate mining development: According to Argentina’s Mining Undersecretary Fernanda Ávila, Argentina, Chile, Bolivia, and Brazil will leverage their mineral resources, processing capacity, and vehicle manufacturing to improve their EV supply chain. She underscored this would prepare the region “for what’s coming and be able to adapt – beginning perhaps with cells, working toward industrialisation, and getting to batteries.” She continued it is about adding value and that “it’s about making the most of this window of opportunity, not just by shipping out lithium carbonate.” Currently, Argentina, Chile, and Bolivia account for over half the world’s lithium resources.
  • Canada working to ease permitting process for mining companies and incentivize investment: Canada’s Minister of Natural Resources Jonathan Wilkinson said the country is considering tax reform that would incentivize investments in clean energy like the Inflation Reduction Act to attract investments to its critical minerals sector during a panel event on March 7. He also noted, “We are reviewing Canada’s regulatory process for clean energy projects including critical minerals.” Minister Wilkinson also discussed Chinese investment with Reuters, saying Canada remains concerned over Chinese-state-owned companies that have control via mechanisms like offtake agreements but noted that the country will not force Chinese state investors to divest their stake in the country’s three largest miners because looking backward at investments would “create all kinds of uncertainty about whether an investment is ever really an investment.” Additionally, Industry Minister Francois Philippe Champagne discussed Canada’s decision to bar Chinese investment in some companies, saying it has “been well received by our partners and allies around the world.” However, mining companies discussed how the crackdown on Chinese investment in critical minerals would make it more difficult to receive the funding necessary to mine the minerals needed for the energy transition.
    • Related: Following Australia’s decision to block a Chinese company from increasing its share in Northern Minerals Ltd, China’s Foreign Ministry spokesman Mao Ning said, “We hope that Australia can provide a fair and non-discriminatory environment for Chinese enterprises to operate in Australia” on March 3 during a regular press briefing.
  • Argentina engages with stakeholders to clarify bill that could label Andean salt flats as a wetland: Argentina’s government is engaging in talks with policymakers and companies to ensure proposed legislation that could label the lithium-rich Andean salt flats region as a wetland due to subsurface saline pools would not impede lithium exploration, according to Mining Undersecretary Fernanda Ávila. Specifically, she said, “What we’re debating and discussing is how the wetlands law can go through without putting mining projects at risk.” Notably, she mentioned the country is talking with companies who are looking to invest at least $4 billion to give them “better assurances through an agreement encompassing several issues.”
    • The legislation, which would be the country’s first wetlands conservation law, is supported by President Alberto Fernández and hundreds of NGOs but has raised concerns primarily from the Governors of the country’s three main lithium provinces. The high-profile legislation has received support from numerous NGOs.

• European Union plans to reduce supply chain risks and create central purchasing agency for critical minerals: According to a draft version of the Critical Raw Materials Act, which is to be released on March 14, the EU will create a central purchasing agency for critical minerals known as the European Critical Raw Minerals Board. Additionally, the legislation will force member states to decrease the amount of time it takes to permit new mines and processing plants. The draft legislation notes, “it is necessary to take measures to ensure access to a secure and sustainable supply of critical raw materials in order to safeguard the union’s economic resilience and strategic autonomy.” Notably, the draft legislation requires the EU “to not be dependent on one single third country for more than 70% of imports for any strategic raw material by 2030.”
  • Specifically, the Critical Raw Minerals Board would coordinate action to ensure by 2030, the bloc produces at least 10%, recycles at least 15%, and processes at least 40% of strategic materials needed each year. Additionally, if a project is labeled as strategic, it would receive streamlined permitting and access to funding, possibly including state funds. Strategic mines and processing plants would have to receive permits within 24 and 12 months, respectively.

• Ursula von der Leyen visits Canada and the U.S. to discuss critical minerals: European Commission President Ursula von der Leyen met with Prime Minister Justin Trudeau on March 7 to discuss Russia’s invasion of Ukraine and energy security, including critical minerals. Notably, the leaders toured a lithium recycling firm that has operations in Canada and the EU. Von der Leyen will also visit Washington, D.C., on March 10 to discuss the EU’s concerns with subsidies in the Inflation Reduction Act (IRA) with President Joe Biden. Notably, they are expected to agree to begin negotiations on a free-trade agreement-like status for the EU, allowing it to qualify for various incentives, including clean vehicle tax credits, under the IRA.

• UK Foreign Affairs Committee visits Chile to explore critical mineral development: UK’s Foreign Affairs Committee will meet with the Chilean Minister for Foreign Affairs, the Minister for Mining, members of the Chilean Congress, the British Ambassador to Chile, and the Five Eyes Ambassadors – an intelligence alliance comprising Australia, Canada, New Zealand, the United Kingdom, and the United States – to learn about Chile’s critical mineral resources, as well as investment opportunities. The committee hopes this will continue bilateral relations between Chile and the UK.
  • The Committee will also meet with local representatives and investigative journalists and visit a lithium mine refinery to learn more about mining in Chile.

• Indigenous leaders voice concerns over EU proposed law: Three indigenous leaders representing Cultural Survival, a U.S.-based NGO, visited Brussels last week to voice their concerns that the European Commission’s Corporate Sustainability Due Diligence Directive would only cover 1% of companies in Europe given the proposed law’s size requirements and that smaller company partners would not fall under the bill. Additionally, one of the leaders mentioned it does not specifically reference “the right to free, prior, and informed consent covered by the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP), nor the International Labour Organisation convention 169.” While not opposed to the directive, the leaders voiced their concerns that “the level of sensitivity is rising across the board, however, there is so much more work that needs to be done.”
  • On March 9, Members of the Committee on the Environment, Public Health, and Food Safety adopted their opinion on the directive calling for stricter environmental and climate impact requirements for companies. Once approved, Member States will have two years to integrate it into their national law.

• A new Global Trade Research Institute report warns that increased electric vehicle production in India will increase reliance on China: The Global Trade Research Institute (GTRI) released a report detailing how increasing India’s production of EVs will make the country more reliant on China for raw materials, mineral processing, and battery production. Additionally, the report highlighted issues with EV production, including their high price, ability to travel long distances, capabilities in extreme weather conditions, increased global power demand, no reduction in net pollution, forecasted supply gaps in lithium availability, and supply chain disruptions.
  • Currently, roughly 70% of materials used in battery manufacturing for EVs in India are imported from China. With Chinese-owned lithium mines in Australia and South America, China processes over 60% of the global share of lithium, as well as 65% of cobalt and 93% of manganese.

• United Nations agree on treaty to protect marine biodiversity: Nearly 20 years after talks began, the United Nations agreed to a draft legal framework aimed at protecting 30% of the world’s oceans on March 4. The agreement was reached by delegates of the Intergovernmental Conference on Marine Biodiversity of Areas Beyond National Jurisdiction and is already being referred to as the “High Seas Treaty,” which will be crucial to addressing climate change, biodiversity loss, and pollution, according to UN Secretary-General António Guterres. The new treaty builds on the UN Convention on the Law of the Sea and will create a new body to manage the conservation of marine life, require marine genetic resource sharing, establish rules requiring commercial activities to conduct environmental impact assessments, as well as create protected areas in the high seas—oceanic regions outside national boundary waters. Notably, activities such as deep-sea mining can occur in conservation areas, so long as “it is consistent with the conservation objectives.”
  • UN countries must now formally adopt the treaty, which will only enter “into force” once 60 countries agree to the treaty and ratify it in their own countries.

• Ontario introduces amendment to speed up mining project permitting: On March 2, Ontario’s government introduced the Building More Mines Act, 2023, to increase investment into the region’s mining sector and strengthen the province’s critical minerals supply chain. Specifically, the legislation would amend the Mining Act by:
  • “Advancing critical minerals projects by making it easier for companies to get a permit to recover minerals from mine tailings and waste – materials left behind after the targeted minerals are extracted”
  • “Improving closure planning by having more qualified professionals available to certify plans and allowing companies to conditionally file a closure plan while deferring certain elements to a later date”
  • “Allowing more flexibility in the techniques used to rehabilitate mines once they are closed, while upholding Ontario’s world-class environmental protection standards”
  • “Creating more options for companies to pay financial assurance. Instead of paying financial assurance upfront, it could be paid in phases tied to the project’s construction schedule.”
  • The public comment period will be open until April 16, 2023.

 Looking Ahead

• The Association of Equipment Manufactures is hosting CONEXPO-CON/AGG in Las Vegas, Nevada, on March 14-18: This event is North America’s largest construction trade show where 1,800 equipment manufacturers meet to learn, talk, compare, and see the technology and equipment that’s going to transform your business.
• The Financial Times is hosting Commodities Global Summit in London, United Kingdom, on March 20-22: Now in its 12th year, the Summit has established itself as an influential gathering of senior commodity executives, traders and financiers.
• The Swiss Mining Institute is hosting a conference in Zurich, Switzerland, on March 21-22: This invite-only event of selected asset managers, fund managers, and other professional investors from all over the world will provide top quality, independent perspectives from experts within the resources sector together with presentations from 80 selected mining companies.
• Mining Journal and Aspermont are hosting Mining Journal Select London in London, United Kingdom, on March 27-28: This event brings together a selection of major miners and companies with rated development projects to present to an audience of over 400 institutional and retail investors.
• SAFE and the Electrification Coalition are hosting the SAFE Summit 2023 in Washington, DC, on March 28-29: This event will convene top government officials, business leaders, and other stakeholders from the United States and allied nations to address the challenges to achieving secure and reliable supply chains in the transportation and energy sectors.
• Solar Media is hosting Energy Storage USA 2023 in Austin, Texas, on March 28-29: This event will provide the perfect platform to connect key industry players across the entire value chain in a buzzing U.S. market.
• Economic Impact is hosting the 8^th Annual Sustainability Week in London, United Kingdom, on March 29-31: This event aims to empower businesses to accelerate action on sustainability.
• Fisa and GL Events are hosting Expomin in Santiago, Chile, on April 24-27: This event is the  largest mining show in Latin America and serves as a space to promote the transfer of knowledge, experiences, and technologies that contribute to innovation and increase the productivity of mining processes.
• Beacon Events is hosting Mines and Money London in London, United Kingdom, on April 25-26: This event is Europe’s premier mining investment event, connecting miners with money, and investors with opportunity.
• The Organisation for Economic Co-operation and Development is hosting its 2023 Forum on Responsible Mineral Supply Chains in Paris France, on April 25-28: This event will reflect longstanding and emerging priorities in fostering responsible mineral supply chains, with sessions spanning new conflict risks, corruption and environmental risks in mineral supply chains, drivers of responsible trade and systemic issues like regulatory developments and taking responsible finance to scale. A key theme will be on leveraging due diligence to foster synergies between the objectives of a responsible and reliable supply of minerals critical to the energy transition.
• AME Mocambique and AMETrade are hosting Mozambique International Mining & Energy Conference and Exhibition in Maputo, Mozambique, on April 26-27: This event will focus on key developments, policies, and projects in Mozambique’s extractive industries, making it an important platform for stakeholder networking and showcasing the opportunities in these sectors.

 In Case you Missed It

• • Nikkei Asia: G-7 eyes joint effort to turn e-waste into rare earths, other metals
  • E&E News: Climate law’s mineral mandates could impede EV adoption — study
  • S&P Global: CERAWEEK: Battery metals industry needs transparency, permitting certainty
  • KITCO: Rare earths producer Lynas secures A$200M from Japanese govt
  • E&E News: Memo to agency heads aims to speed permitting
  • International Mining: International Copper Association publishes its Pathway to Net Zero
  • Euronews Next: Europe in race to secure raw materials critical for energy transition
  • Mining Weekly: Australia leading the way in critical minerals – report
  • E&E News: Senate committee to address uranium supply concerns
  • CNBC: Bank of America sees lithium surplus in 2023 as demand eases
  • Bloomberg: Indonesia to Offer Incentives for Over 235,000 EVs This Year
  • POLITICO: Von der Leyen fails to steer a deal between Berlin and Brussels on car engine ban
  • E&E News: ‘Silicon Valley of lithium’: Nevada mine breaks ground
  • E&E News: Barrasso questions DOE link to report on lithium, transit
  • Bloomberg: Shortage of Metals for EVs Is Rising Up the Agenda in Automakers’ C-Suites
  • American Bar Association: Diving deep on the international law of seabed minerals
  • Bloomberg: CATL Chairman Urges Beijing to Review Energy Storage Standards
  • Reuters: Oman to offer new mining concessions in Q1 2023 – tweet
  • com: Tesla lobbying to secure lithium from Chile — report
  • The Hill: USPS to purchase 9,000 electric vehicles, install 14,000 charging stations
  • Reuters: South Korea, US, Japan meet on supply-chain resilience

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