The partnership was announced at this year's PDAC convention, and will aim to bolster critical minerals supply chains.
The US has partnered with Canada and other countries to secure supply of critical raw materials that will fuel the green energy transition.
The establishment of the Minerals Security Partnership (MSP) was announced at this year’s Prospectors & Developers Association of Canada convention, which is taking place in Toronto from June 13 to 15.
Demand for key battery metals — essential for electric vehicle (EV) batteries — is expected to increase exponentially in coming years. According to the World Bank, production of minerals such as graphite, lithium and cobalt could increase by nearly 500 percent by 2050 to meet the growing demand for clean energy technologies.
“The goal of the MSP is to ensure that critical minerals are produced, processed, and recycled in a manner that supports the ability of countries to realize the full economic development benefit of their geological endowments,” the US Department of State said in a press release.
The partnership comes at a time when countries around the world are trying to build out their supply chains and secure EV raw materials, reducing dependence on China.
In April, the Canadian government committed C$3.8 billion in its federal budget to implement a new critical minerals strategy over eight years. The funds, expected to boost domestic production of lithium, copper and other strategic minerals, will support the country’s plan to play a key part of the global EV supply chain.
“As we transition to cleaner, mineral intensive forms of energy, democratic countries are going to need access to stable and secure sources of critical minerals,” Jonathan Wilkinson, Canada's minister of natural resources, said at PDAC. “Clearly, rapid development of these sources is urgently required.”
Meanwhile, US President Joe Biden invoked the Defense Production Act in March to help companies access government funding for feasibility studies for new projects that extract lithium, nickel and other EV metals. The government’s goal is for half of US passenger car and light-truck sales to be zero emission by 2030, and for that to become a reality mining is required.
Other countries that are part of the MSP initiative include Australia, Finland, France, Germany, Japan, the Republic of Korea, Sweden, the UK and the European Commission
“The MSP will help catalyze investment from governments and the private sector for strategic opportunities — across the full value chain — that adhere to the highest environmental, social, and governance standards,” the statement from the group reads.
To meet the increasing need for lithium, this sector alone would require US$7 billion of investment each year from now until 2028, according to Benchmark Mineral Intelligence. Demand is expected to reach 2.4 million tonnes a year by 2030 — four times higher than the 600,000 tonnes forecast to be produced in 2022.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.
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