FEATURE: Now that critical minerals have appeared on the world’s industrial radar, the UK must compete with bigger national geographies and immense purchasing powers to ensure its own supply.
TIME AND SPEED
The Government has outlined its industrial strategy to assess the country’s requirements and assets to tackle pressing issues such as mobility, green energy and advanced AI.
But the actual time factor of each step to reach those goals has so far been elusive as well as the steps needed to decide what needs to be mined, where, when and by whom in order to obtain the essential minerals.
Covid-19 exposed countries’ dependence on China for minerals; the country owns 80% of global rare earth elements and up to 100% of downstream processing and manufacturing. It also has a large share of tungsten, graphite and vanadium.
The response from the United States, Canada, Australia, the European Union and the UK is a race to reach the remaining 20% – a behaviour the Faraday Institution highlighted in April 2020 when it warned of supply bottlenecks and mineral price spikes unless action was taken to manage supply risks.
ETHICS
It is unlikely any nation or multinational corporation would want to alert competitors by revealing the true amount of the natural resources they hold and acquire or their sources and extraction techniques.
Secrecy will be a factor in obtaining and retaining supply which in turn leads to the further concern of environmental, social, and corporate governance (ESG) and the new buzz phrase of “clean metals”.
Indigenous groups now have a louder voice although Rio Tinto seemed not to have heard in Juukan Gorge, Western Australia.
Issues persist in the Lithium Triangle (Argentina, Bolivia and Chile), believed to hold 50% of the world’s lithium, and there are still vivid memories of child labour in the Democratic Republic of Congo.
The UK has long held interests in Africa and South America but needs to be quick and ethical.
However, extraction forms only part of a minerals strategy; processing plants and refineries must be built, costs calculated and supply controlled.
UK RESPONSE
Critical minerals taken as one category is still a young industry and government steps taken so far include establishing in March 2020 an All-Party Parliamentary Group (APG) for Critical Minerals with six MPs.
The APG aims “to highlight the UK’s need for a secure, sustainable supply of critical minerals to deliver the nation’s industrial strategy.”
The panel has two MPs from the historical mining area of Cornwall where mining seems not to be a dirty word unlike most parts of the UK where it remains synonymous with the coal industry.
The APG’s secretariat is the independent Critical Minerals Association (CMA) which provides a platform for companies and individuals to unite and share key insights with the Government.
The CMA’s four-pronged approach includes increasing the self-sufficiency of supply chains for the UK’s industrial strategy, and to provide peer-to-peer support on best practice and set recognised standards for critical mineral companies.
Its third aim is to improve society’s and Government’s perception of the critical minerals sector and highlight its importance for the UK’s industrial strategy. This lies alongside the sector’s ability to maintain high ethical standards.
Fourthly, the CMA provides a direct line of communication between industry and Government and creates a “unified influence of industry.”
However, Government and industry need to work hard to prove that mining can be a reputable profession vital to the UK’s economy.
The lingering gap between the profession and public perception was further revealed when the Camborne School of Mines based in Cornwall suspended new intakes for this academic year because of the low number of applications.
Nor does it help that Government has no single department responsible for mining; the job is currently shared by the Department for Business, Energy and Industrial Strategy; the Department for Environment, Food and Rural Affairs; the Department for International Trade; and the Ministry of Defence.
WHICH MINERALS?
Industry – and equally important – investors’ response has seen mining companies exploring in Cornwall and Devon for lithium, tin and tungsten as well as internationally for cobalt, nickel and rare earth elements.
Unlike the EU and the US, the UK has no ‘critical minerals’ list, or one for ‘technology metals’ or ‘energy transition metals’.
It seems a vague approach but an alternative view is to look at the country’s particular needs.
The UK’s list – or lists – could be flexible and decided by three areas of demand.
The defence industry has its own needs and forms a larger sector of the economy than other European countries apart from France.
Technology metals could be seen as a second area but they also underline the need for copper just as much as ‘critical minerals’.
And strategic minerals present a third demand where the UK must consider countries who ban or impose prohibitive tariffs on exports.
Whichever course the Government follows in its new treaties and offtake agreements after the UK leaves the EU, it needs to navigate a clearer path to gain a place in the race for critical minerals.