Australia’s federal government is setting up a A$2bn ($1.45bn) loan facility to stimulate the development of critical minerals projects in the country.
Prime minister Scott Morrison, who announced the plan after last week’s first meeting in Washington of the so-called Quad featuring Australia, the US, India and Japan, said the fund would effectively help fill financing gaps in critical minerals developments to get them off the ground.
Critical minerals include lithium, graphite, vanadium, tungsten, cobalt, manganese, zirconium, scandium, molybdenum, hafnium and rare earths with applications in sectors such as renewable energy, aerospace, defence, automotive and electric vehicles in particular, as well as telecommunications and agriculture technology.
“The commercial dimensions of the critical minerals market mean it is a difficult place to get established,” Morrison said. “We want to ensure that Australia’s resources producers do get established so they can link up with others in our supply chains in a free and open Indo-Pacific.”
Government agency Export Finance Australia will manage the facility, which is aimed at setting up commercial critical minerals projects to boost supply security and reduce the reliance on dominant market participants such as China.
Australian resources minister Keith Pitt said the Critical Minerals Facility would ensure that the country remains at the forefront of emerging new opportunities in the global resources sector.
“Australia is already among the world’s top suppliers of some of the world’s most sought-after critical minerals and we know there is enormous potential through our untapped reserves,” he said.
Australian Strategic Materials (ASM), which is developing a mine-to-metals business between Dubbo in Australia’s New South Wales and Ochang in South Korea, said it will increase the capacity of Australia’s potential to be a global leader in critical minerals, according to chief executive David Woodall. ASM already has provisional funding from Export Finance Australia for its A$1bn Dubbo rare earths project, which will supply material to the soon to be commissioned Korean Metals Plant for the production of critical metals and alloys.
Australian Vanadium, which is developing a A$550mn vanadium project in Western Australia (WA), Hastings Technology Metals, which is developing WA’s A$519mn Yangibana rare earths project and the Association of Mining and Exploration Companies have also welcomed the funding facility.
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