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

 Recent Developments

• Indonesia warns miners to comply with environmental regulations: Indonesia’s Coordinating Minister for Maritime and Investment Affairs Luhut Pandjaitan warned companies that if they do not comply with environmental regulations, he would shut them down during the Indonesia Leading Economic Forum 2023 in Jakarta.
  • Specifically, he said, “You have to comply with regulations set up by the Indonesian government. If you can’t, I will shut down your industry within two months.” He continued that “Maybe it would reduce some of our revenue, but then (we) don’t want to compensate for that with a bad environment,” highlighting how important protecting the environment is to the government.

• EU stresses it must develop its critical materials supply chain: European Commission President Ursula von der Leyen said the EU must invest more in research and development to develop its mining and processing of critical raw materials on March 15. She also stressed the bloc’s current dependence on China for minerals, noting that if the EU wants to be independent, “we urgently have to strengthen and diversify our supply chains with like-minded partners.” Lastly, she noted, “We must get our act together if we want to stay front runners.”
  • The Commission released its Critical Raw Materials Act and the Net-Zero Industry Act on March 16 to improve the production of clean technologies, as well as secure a stable supply of rare earths and critical minerals. Both acts are part of the European Green Deal Industry Plan, which was a response to the U.S. Inflation Reduction Act. Stay tuned for next week’s newsletter for an overview of the acts.

• U.S. Department of State allocates $100 million to fund CHIPS Act projects in fiscal year 2023: The U.S. Department of State announced on March 14 it allocated $100 million in fiscal year 2023 for CHIPS Act projects under the International Technology Security and Innovation Fund (ITSI Fund). Specifically, the funding will help secure critical material inputs, strengthen international policy coordination, expand and diversify downstream capacity in the Indo-Pacific and the Americas, and protect national security for semiconductors. Additionally, it will help develop enabling environments for secure information and communications technology (ICT) ecosystems, deploy secure ICT infrastructure, and defend against malicious cyber activity for secure ICT.
  • The ITSI Fund gives the U.S. Department of State $500 million over five years to help improve semiconductor supply chain security and international ICT security.

• U.S. Department of Transportation opens $2.5 billion for EV charging infrastructure: The U.S. Department of Transportation opened $2.5 billion in new grants to construct EV charging and alternative-fueling infrastructure in all types of communities across the country as part of the Biden administration’s goal of building a national network of 500,000 EV charging stations by 2030. The Charging and Fueling Infrastructure Discretionary Grant Program will award $2.5 billion over five years to cities, countries, local governments, and tribes, with $700 million available from fiscal years 2022 and 2023.
  • Applications to the funding opportunity are due by May 30, 2023.

• U.S. House Republicans released energy and permitting package text: House Republicans released their “Lower Energy Cost Act” on March 14, which combines several bills from the Energy and Commerce, Transportation and Infrastructure, and the Natural Resources Committees and is their first attempt at passing permitting reform legislation wanted by both parties. Known as H.B. 1, highlighting its importance as the first bill introduced, members of Congress hope this will lead to negotiations retaining to permitting reform; however, many Democratic lawmakers have promised to oppose the legislation. Specifically, Senate Majority Leader Chuck Schumer (D-NY) claimed the bill is a “nonstarter in the Senate,” indicating the bill will be dead upon arrival. Additionally, Sen. Joe Manchin (D-WV) noted, “I’d like to have it by itself … a separate bill, not wrapped into a major energy bill that reforms everything again.”
  • The bill includes provisions to promote natural gas exports, ease permitting regulations related to critical minerals, repeal the methane fee, as well as limit the ability of states to block projects using the Clean Water Act. House Speaker Kevin McCarthy (R-CA) noted, “Every time we need a pipeline, road or dam, an average of almost 5 years and millions of dollars in costs get added to the project to comply with Washington’s permitting process. That’s too long, we can streamline permitting and still protect the environment.”
  • Republicans plan for the package to reach the House Rules Committee the week of March 27, after which it will be considered on the House floor.

• China to increase deep-sea mining research and development: Deputy Director of the China Ship Scientific Research Center Ye Cong discussed how deep-sea mining will help China reduce its “heavy reliance on foreign suppliers” for metals, which are extensively used in Chinese factories at the 14^th National Committee of the Chinese People’s Political Consultative Conference (CPPCC). He added that China is facing challenges bringing ores up the seabed several thousand meters below the surface and that China needs “a reliable, powerful system consisting of pumps and tubes that can bring the mixture of seawater and extracted ores to ships.” He also said, “[China] must thoroughly study the possible impact on deep-sea ecosystems and make sure that our solution can protect the marine environment and biodiversity. We also need to figure out an economical, sustainable approach to mining from ocean floors, or we won’t be able to afford it.” Members of the 14th CPPCC National Committee are urging the government to speed up the approval process for deep-sea mining research and development.
  • On the other hand, marine biologist and Director of SpeSeas, an ocean conservation group based in Trinidad and Tobago, Diva Amon, expressed concern that there currently lacks enough “publicly available scientific knowledge comprehensive enough to enable evidence-based decision-making regarding environmental management of deep-sea mining.” She underscored that protecting ocean biodiversity is critical to regulating the climate, and without more scientific knowledge, deep-sea mining could cause irrevocable harm.

• India and Australia agree to deepen critical minerals investment partnership: Australia’s Minister for Resources and Minister for Northern Australia, Madeleine King, and India’s Minister for Parliamentary Affairs, Coal and Mines, Shri Pralhad Joshi, agreed to deepen cooperation and extend their existing commitments under the Australia-India Critical Minerals Investment Partnership. Specifically, they identified two lithium and three cobalt projects to conduct a detailed due diligence process. Minister King highlighted that “India’s goals to lower carbon emissions and boost electric vehicle production presents great opportunities and prospects for Australia’s critical minerals sector, for renewable exports and for building stronger supply chains.” With the expected increase in demand for critical minerals and Australia’s current position as one of the leading producers of lithium, cobalt, and rare earth elements, India and Australia are hopeful this partnership will secure a stable critical mineral supply chain.
  • Related: U.S. Secretary of Commerce Gina Raimondo and Indian Minister of Commerce and Industry Piyush Goyal signed a Memorandum of Understanding on Semiconductor Supply Chain and Innovation Partnership during the U.S.-India Commercial Dialogue on March 10 to strengthen their critical mineral supply chains, including promoting commercial opportunities, R&D, and talent and skill development.

• U.S. envoy heads to South America to discuss areas of collaboration: U.S. Deputy Energy Secretary David Turk will meet with government, academic, and industry representatives in Brazil, Chile, and Argentina this week to discuss possible areas of collaboration, including critical minerals, clean energy technologies, and nuclear power.

• U.S. government officials warn about China’s control of the clean energy supply chain: John Podesta, a Senior Advisor to the President for Clean Energy Innovation and Implementation, noted that China currently has too much control over the critical minerals industry, including processing and upstream technologies, and the solar industry during CERAWeek in Houston last week. Along with other officials, he also discussed how Europe’s history of relying on Russian energy is an example of the risks of relying on global rivals. Specifically, he said, “It’s just clear, to say it directly, that China has too much of a chokehold on critical minerals, on critical processing and upstream technologies, and solar.” He continued by saying, “We let that go. That was a mistake. We need to get it back.”
  • At the American Council on Renewable Energy conference on March 9, he also said that while the Chinese are going to be “big players” and have a large domestic market, “we can’t be beholding to only Chinese supply for these critical materials, when they have indicated that they’re perfectly prepared to use their economic power when it serves their interests in a strategic way.” However, Sen. Joe Manchin (D-WV) was quick to critique his remarks in a press release, saying, “It is beyond irresponsible for someone speaking on behalf of the White House to not only condone but also advocate for sending American tax dollars to Chinese companies. That is not consistent with either the IRA or the CHIPS + Science Act, which had widespread bipartisan support due to concerns about Chinese supply chains.” He continued by saying he “will do everything in my power to prevent this Administration from welcoming China to take federal dollars with open arms.”
  • Related: Sens. Joe Manchin (D-WV) and Marco Rubio (R-FL) continued to critique CATL’s battery plant agreement with Ford. Sen. Manchin noted he is “totally opposed” to allowing CATL to access tax dollars that finance EVs as part of its partnership during CERAWeek. In response, Ford said it will own the U.S. facility and no one else will get U.S. tax dollars. A Ford spokesperson said, “Making these batteries here at home is much better than continuing to rely exclusively on foreign imports, like other auto companies do.” Sen. Rubio also continued to oppose the partnership and introduced the Restricting Electric Vehicle Outlays from Kleptomaniac Enemies (REVOKE) Act of 2023 which aims to significantly restrict the eligibility of IRA tax credits and prevent Chinese companies from benefiting, according to a press release.

• U.S. and EU begin negotiations on critical minerals agreement: U.S. President Joe Biden and European Commission President Ursula von der Leyen met on March 10 at the White House to discuss Building the Clean Economies of the Future, Standing Together to End Russia’s War Against Ukraine, and Strengthening Economic Security and National Security. Notably, they announced the EU and U.S. will “immediately begin negotiations on a targeted critical minerals agreement for the purpose of enabling relevant critical minerals extracted or processed in the European Union to count toward requirements for clean vehicles in the Section 30D clean vehicle tax credit of the Inflation Reduction Act.”
  • Von der Leyen told reporters after the meeting that the European Union will have access to the American markets “as if they had been sourced in the United States.” Their statement also announced “the launch of the Clean Energy Incentives Dialogue to coordinate our respective incentive programs so that they are mutually reinforcing.”

• European Union mobilizes €50 million to support the Democratic Republic of the Congo’s (DRC) mining sector: During the Kinshasa Economic Forum in the DRC, the European Union announced an initial investment of €50 million to support the DRC’s critical minerals sector and infrastructure projects under the EU’s Global Gateway initiative. Specifically, the investment will fund geological mapping, urban infrastructure, and digital education projects.
  • The initiative has allocated €150 billion to help Africa accelerate its green transition while maximizing the transition’s benefits and minimizing threats to the environment.

• New report shows lithium from hard rock sources is often more carbon-intensive than brine sources: According to Benchmark’s Lithium ESG Report, hard rock lithium sources such as spodumene can be over three times more carbon-intensive than brine lithium sources due to how it is processed, which is “is a much more energy-intensive process than brine,” according to Benchmark analyst Olivia Lin; however, hard rock lithium sources are projected to account for around 60% of global lithium supply through 2030. Notably, over half the emissions from producing lithium hydroxide come from China’s electricity grid or the production site. The report also discusses the direct water use of spodumene versus brine, noting that “Even though brine-based producers encounter media pressures surrounding water consumption, it is clear that, based on life cycle assessment (LCA) analysis for processing needs, water use, and impact, are higher for spodumene.” With new technology, including direct lithium extraction (DLE), lithium extraction is becoming more efficient. By 2030, DLE extraction is forecasted to make up 16% of global mined lithium.
  • The report concludes that life cycle assessments (LCA) are a vital component of a company’s overall environmental, social, and governance (ESG) reporting because it takes into consideration the direct impacts and Scope 2 and 3 impacts.

 Looking Ahead

• 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.
• Canadian Institute of Mining is hosting CIMTL 23 Convention and Exhibition in Montreal, Canada, on April 30-May 3: This event features an extensive program consisting of expert-led short courses, three full days of technical presentations on insightful topics, a complete student/young leaders’ program, daily social networking opportunities, and the CIM/Caterpillar Awards Ceremony. It also includes the premier mining marketplace for business with over 450 exhibitors at the EXPO.
• StoneX is hosting Energy & Metals Outlook: Managing Risk in a Greening Economy in New York, New York, on May 3-5: This event will give exposure to deep-domain experts in major sectors across the industrial supply chain, where attendees will gain fundamental and strategic analysis of the outlooks for the changing shape of the metals and energy industries as we move toward net zero emissions, including content presented by our carbon solutions team.
• Society for Mining, Metallurgy & Exploration is hosting SME’s 8th Current Trends in Mining Finance Conference in New York, New York, on May 8-11: The conference will bring together many subject matter experts and interested stakeholders to discuss the outlook, trends, and non-technical and technical issues that affect capital raising in the global mining industry and how management and investors can employ best practices and technology to anticipate, track, manage and reduce the risks associated with mining projects.
• Automotive Logistics is hosting Finished Vehicle Logistics North America in Waterfront Beach Resort, California, on May 9-11: This event will cover the most important issues for vehicle logistics through a program of hard-hitting panels and sessions, interactive workshops, and innovator showcases.
• The European Union and EIT RawMineral e.V. are hosting the Raw Mineral Summit in Brussels, Belgium, on May 15-17: This event  will feature leading players in the international raw materials industry, innovators, educators, researchers, prominent figures from the European Commission, NGOs, and more. Key discussions will be on the major innovations, policy initiatives, challenges, and opportunities facing the raw materials sector will take place.
• Mining Center Mexico is hosting Discoveries 2023 Mining Conference in Sinaloa, Mexico, on May 30-June 1: This event includes over 50 talks covering topics ranging from the latest geological discoveries; new technologies applied to mining and exploration; social, legal, and political issues affecting the industry; and the challenges and obstacles confronted and overcome on the way to production.

 In Case you Missed It

• Reuters: BMW cautiously optimistic on 2023, EV targets ahead of schedule
• Cipher News: How to get the minerals we need in a clean energy future
• The Northern Miner: Indigenous ownership models gain steam alongside critical minerals rush
• E&E News: Europe lurches into civil war over car engine ban
• Reuters: China battery giant CATL’s $5 bln Swiss listing delayed amid Beijing regulatory concerns – sources
• BBC: The looming threat of deep-sea mining
• AP News: Bill to halt mining near Okefenokee gets hearing but no vote
• Georgia Recorder: Supporters of mine near Okefenokee hint at lawsuit if Georgia lawmakers pass bill protecting swamp
• com: Mercedes & CATL subsidiary Brunp announce battery recycling cooperation
• CNBC: Canada is aiming to beat China in the critical race for rare earth metals
• MIT Technology Review: US minerals industries are booming. Here’s why.
• Bloomberg: Volkswagen to Build Battery Plant in Canada to Fast-Track Expansion
• Reuters: Mitsubishi Motors to sell only EVs, hybrids by mid-2030s
• Financial Times: China set to tighten grip over global cobalt supply as price hits 32-month low
• POLITICO: China leaves EU playing catchup in race for raw materials
• Bloomberg: China Lithium Probe Puts Spotlight on Reserves and ESG Risks
• CNBC: Is the U.S. falling behind China in Africa’s lithium industry?
• Bloomberg: Tesla Supplier CATL Smashes Profit Estimate as EV Sales Soar

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