Australian government extends $ 2 billion loan facility for critical materials industry

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Australia could lag behind in supporting electric vehicles and reducing greenhouse gases; but the Australian government is stepping up support for the mining industry through a new policy for “Australian critical mineral projects”. This is good news for critical mineral miners with Australian projects.

You can view the US list of 35 Critical Minerals here. The most interesting are lithium, graphite, cobalt, nickel, rare earths, vanadium, tin, manganese, aluminum, uranium and scandium; because they play a role in the new energy economy of electric vehicles, energy storage, nuclear energy, solar and wind power generation.

According to the International Energy Agency (IEA): “A typical electric car requires six times more mineral inputs than a conventional car, and a off the coast wind plant requires thirteen times more mineral resources than gas of similar sizefired Power plant.”

The IEA predicts an increase in demand from 2020 to 2040 to achieve a sustainable development scenario

Source: IEA: The role of critical minerals in clean energy transitions – May 2021

Australia’s Critical Minerals Projects To Receive A $ 2 Billion Boost

On September 28, 2021, the Australian government announcement:

“(it) will establish a $ 2 billion loan facility for Australia’s critical mineral projects to help secure the vital resource supplies needed to boost the new energy economy and support the resource jobs of the future …… Australia has one of the world’s largest recoverable reserves of essential minerals used in advanced technologies, such as renewable energy, aerospace, defense, automotive and electric vehicles in telecommunications and agro-tech… Prime Minister Scott Morrison said the fund would effectively help close funding gaps in the development of critical mineral resources to get them off the ground… Global demand for essential minerals needed by clean technology applications, such as magnets and high power batteries, are expected to grow exponentially over the next few decades.

It is probably no coincidence that the Australian Prime Minister has I just returned from a trip to the USA ensure the military defense and other support of the “Quad alliance” (Quadrilateral security dialogue), involving the United States, Japan, India and Australia. In the United States, President Biden may have pushed for a better supply chain for critical raw materials from Australia. And There you go !

The Australian government announcement was fairly short on the details, but did state:

“The $ 2 billion critical minerals facility will be managed by Export Finance Australia and will report to Minister of Trade, Tourism and Investment, Dan Tehan. It will operate on the national interest account for 10 years or until funding equivalent to $ 2 billion has been provided. “

Some junior critical miners with Australian projects that could potentially benefit (in alphabetical order)

  • Ardea Resources Limited (ASX: ARL) – Kalgoorlie nickel-cobalt project in Western Australia (WA).
  • Australian Strategic Materials Limited (ASX: ASM) – The Dubbo Rare Earth Project in NSW, Australia.
  • Australian Vanadium Limited (ASX: AVL) – The Australian Vanadium Project in WA, which has Status of the major federal project.
  • Cobalt Blue Holdings Limited (ASX: COB) – Broken Hill Cobalt Project in NSW, Australia.
  • Global Energy Metals Corporation (TSXV: GEMC) – Millennial and Mt Isa cobalt-copper-gold projects in Qld, Australia.
  • Havilah Resources Limited (ASX: HAV) – Mutooroo copper-cobalt project and Kalkaroo copper-gold-cobalt project in South Africa.
  • Liontown Resources Limited (ASX: LTR) – Kathleen Valley Lithium Project in Washington State.
  • Magnis Energy Technologies Ltd. (ASX: MNS) – Imperium3 JV lithium-ion battery cell manufacturing project in Townsville, Qld, Australia.
  • Neometals Ltd. (ASX: NMT) – Barrambie Titanium and Vanadium Project in Western Australia. Plus battery recycling technology and lithium mining technology.
  • Sayona Mining Limited (ASX: SYA) – Pilbara lithium assets and East Kimberley Graphite project.
  • Scandium International Mining Corp. (TSX: SCY) – Nyngan Scandium Project in NSW, Australia. In addition, its ion exchange technology (IX) to extract critical materials and its high purity alumina processing technology, HPA.

Closing remarks

With the United Nations Climate Change Conference (COP26) in Glasgow just a month away (November 1-12, 2021), expect to hear many more countries announcing progress towards updated and updated emissions targets.

The Australian $ 2 billion (~ $ 1.44 billion) loan facility for critical Australian government mining projects is a good start, but much more is needed if we are to move to a fully sustainable future and reduce emissions to meet our global emission reduction targets.

At least for now, the Junior Critical Miners (Australia-based projects) have had a substantial boost and hopefully there will be more to come from Australia and other countries to help support the cause.

Disclosure: Author is long ASX: ARL, ASX: AVL, ASX: COB, TSXV: GEMC, ASX: HAV, ASX: MNS, ASX: NMT, TSX: SCY.



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