Australia backs critical minerals sector
AU$2 billion loan facility to solidify AU as leading supplier Metal Tech News - October 1, 2021
Last updated 10/26/2021 at 2:36pm
Seeking to solidify Australia as a leading supplier of the critical minerals that are increasingly being required for electric vehicles, renewable energy, telecommunications, aerospace, defense, and other advanced technologies, the federal government is establishing an AU$2 billion (US$1.44 billion) loan facility for Australian mining projects poised to deliver these vital materials to global markets.
Understanding that traditional funding options are often difficult due to the niche nature of the critical minerals markets, Australia Prime Minister Scott Morrison said the fund would help fill finance gaps to help get Down Under critical minerals development projects off the ground.
"The commercial dimensions of the critical minerals market mean it is a difficult place to get established," he 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."
"Critical minerals are a strategic area for governments too because they are fundamental to the future energy economy," Morrison added.
The Indo-Pacific region includes Australia and New Zealand; Asian-Pacific countries such as Japan and India; South Pacific Island nations; and as far east as the United States.
Australia already hosts some of the world's largest reserves of critical minerals such as cobalt, lithium, manganese, nickel, rare earths, and vanadium needed for the global transition to low-carbon energy and transportation.
Minister for Resources and Water Keith Pitt said the critical minerals facility being established by the Morrison government would ensure Australia 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. "The lithium industry alone, which is essential to develop new battery technology, is forecast to be worth $400 billion globally by 2030 and initiatives like this will mean Australia is well placed to grab its share of the market."
The Morrison government says this positioning of Australia as a world-leading supplier of critical minerals and downstream processing of these essential high-tech elements would support jobs and businesses in Australia.
"The global growth in demand for critical minerals to be used in the production of the latest technologies represents an incredible opportunity for Australia to utilize its natural resources and world-leading mining know-how to become a leader in the extraction, processing and supply of critical minerals," said Australia Minister for Trade, Tourism, and Investment Dan Tehan.
The Australian critical minerals loan facility will be managed by Export Finance Australia and report to Minister Tehan. It will operate for 10 years or until the equivalent of AU$2 billion has been provided.
This lending facility will be an important pillar of the federal government's overarching critical minerals strategy being led by Minister Pitt.
"The new facility comes on top of other initiatives like the government's AU$225 'Exploring for the Future Fund' to support new resources exploration across the country," he said.