In its ongoing efforts to lead the establishment of an independent rare earth elements (REEs) supply chain in the UK, Rainbow Rare Earths, a London-listed company, has entered into a strategic supply agreement with Less Common Metals (LCM) to develop a Western supply chain for REEs.
Under this agreement, Rainbow will provide LCM with REEs that are designated as critical minerals. LCM is the sole manufacturer of rare earth metals and alloys in the UK and one of the few facilities outside China with this capability.
LCM holds a unique position in the rare earths industry as it is the only Western company commercially producing both highly specialized strip-cast alloys and all the necessary rare earth metals required for manufacturing high-performance neodymium iron boron magnets.
The materials that Rainbow will supply to LCM, including neodymium, praseodymium, dysprosium, and terbium, are economically vital REEs due to their use in the production of permanent magnets. These magnets play a crucial role in decarbonization efforts as they are used in wind turbines and electric vehicles. These elements are also recognized as critical minerals in the UK’s Critical Minerals Strategy.
Rainbow’s supplied rare earth oxides (REOs) will be used by LCM to create alloys, which will then be provided to permanent magnet manufacturers in the US and the European Union (EU).
Rainbow’s goal of establishing an REE supply chain outside of China aligns with LCM’s plans to invest in expanded capacity in North America, the EU, and Asia.
LCM sought a partner with similar values to ensure an ethical supply of the required feedstock for their business. Rainbow was selected after an extensive evaluation of various rare earth development companies globally, based on its capability to develop REEs to the separated rare oxide stage using proprietary technology developed by its partner, K-Technologies.
George Bennett, CEO of Rainbow, emphasizes that LCM’s 30 years of experience in manufacturing and supplying metals and alloys to the permanent magnet industry makes it the preferred partner for Rainbow. He adds that LCM’s expertise in expanding its presence in the US and the EU will be instrumental in meeting the growing demand for permanent magnets.
The companies will soon establish a framework for negotiating a binding offtake agreement for separated REOs from Rainbow’s Phalaborwa project in South Africa. The ultimate customer for rare earth permanent magnets will also be determined in due course.
The volumes of supply will be driven by LCM’s requirements for its expanded facilities, and pricing will be determined based on published REO prices at that time. Any surplus production from the Phalaborwa project will be sold on the open market to third parties.
The Phalaborwa project contains approximately 35 million tonnes of gypsum resulting from historic phosphate hard rock mining, which contains REEs with an estimated average in-situ grade of 0.6% total rare earth oxides.
In September, Rainbow successfully produced its first batch of mixed rare earth sulphate, totaling 3 kg, from a front-end pilot plant. This batch has been sent to the back-end pilot plant located at K-Technologies in Florida, USA, for separation into REOs during the last quarter of this year.
In 2021, Norway was revealed to be the location of another large deposit of critical raw materials (CRM),1 as 240 million MT of phosphate, vanadium, and titanium were estimated to be in Storeknuten. This would already be a vast resource of three of the 30 critical raw materials, but since then has been shown by drilling operations to be as much as 910 million MT. The global economy, industry, and the current state of world politics mean that Norway has been presented with an opportunity to take a more prominent role in supplying much of the world’s industrial innovations. This includes the EU and the US, and stands to give Norway a lot more political and economic power in the coming years via developing green industries, increasing exports and growing the number of jobs in the Norwegian industry.
As the name suggests, the EU defines critical raw materials as materials that are critical to industry. Generally speaking, this includes metals and minerals that cannot be replaced by a more common material, that have a significant supply risk, and if there is a disruption of supply, will have economic consequences. For Norway, this will include aluminium, copper, cobalt, zinc, and much more. With the EU moving towards less dependence on China, Russia and other countries for importing, Norway has become a key player in supplying these materials.
CRM in Europe
The shift towards greater production of CRMs comes from a variety of factors, and the EU plan, known as the Critical Raw Materials Act, has a number of objectives. This act, introduced in March 2023, seeks to strengthen the EU’s CRM capacity, reduce dependency, increase preparedness, and promote supply chain sustainability and circularity.2 The reduction of dependency essentially means the diversification of Europe’s supply of materials. Ideally, no more than 65% of one critical material is to be imported from one source. This would lead to several advantages, including the facilitation of manufacturing more green energy solutions, as well as the political advantages of not relying too much on one country’s source. With political tensions in China and the war in Ukraine with Russia, this would be a significant development for the EU and is a key cause of the Critical Raw Materials Act’s existence.
Similarly, and since Norway is not an EU Member State, Norway has its own Green Industrial Initiative. This roadmap aims to increase investment and create jobs within green industries, as well as cutting pollution as it turns towards low-to-no emissions. Vital to this are critical metals and materials. Norway currently has a lot of these materials for not only themselves but also Europe.
The Norwegian Mineral Strategy
As such, Norway has had to change its strategy in terms of mining and processing these materials in order to keep up with the demand from the EU and themselves. In June, the Norwegian government unveiled the Norwegian Mineral Strategy. This strategy is a five-pillar process that aims to improve the Norwegian mineral industry and is a first step towards ‘the world’s most sustainable mineral industry.’3 Within this strategy are five key areas of focus.
Faster implementation of mineral projects
This is primarily concerned with the mapping of critical raw materials as well as reducing the time taken to process the mined materials. Obviously, this will reduce the time from mining the material or mineral to using it or exporting it for use, which in turn will reduce the time taken to develop green industries and grow profit for the economy.
The mineral industry must contribute to the circular economy
A circular economy is designed to minimise both the materials put in as well as the waste materials or pollution outputted. Norway’s circular economy is relatively low at 2.4% as of writing this, so an increase would be beneficial for green plans as well as profits. This will also decrease the cost of construction as material is recycled for use.
A more sustainable mineral industry
Similar to many countries and companies, Norway is aiming for its mineral industry to be zero emission or net zero by 2030. This will also specifically target the use of non-environmentally friendly chemicals in manufacturing processes. This will not only develop new industries as methods and constructions need to be updated or replaced, and therefore create new jobs, it will also benefit the planet and make the industry as a whole much more appealing to people conscious of the effects of industry on the planet.
Private capital is a must
Private capital will be key to funding these endeavours. Furthermore, all options will be explored to increase the profitability of mineral mining and processing, as well as increase the opportunities for communities, i.e. creating jobs. Altogether this aims to greatly stimulate the Norwegian economy.
Norway will continue to supply international partnerships with green value chains
This new strategy aims to change Norway’s global image to being a mineral nation and to further strengthen the ties between Norway and the rest of Europe in terms of trading critical materials. The mining industry has frequently overlooked value chains, leading to wasted resources and isolated operations, leading to miscommunication and bogged-down production.
These five points constitute the Norwegian Mineral Strategy and are an excellent vision of Norway’s hope for its future in mining and processing critical raw materials. With these coming to fruition, Norway will occupy a spot of increasing power on the world stage.
Europe’s position and Norway’s future
As mentioned earlier, Europe currently has a tenuous relationship with China. The political issues in China under EU criticism range from the mistreatment of Uighur Muslims to China’s continued alliance with Russia after their invasion and sustained war in Ukraine. Yet, China is currently able to mine two-thirds of the 30 raw materials, giving them a dominating position in industrial endeavours.
Similarly, Russia was a very contentious country even before the invasion of Ukraine, and most of Europe is on edge regarding a future with Russia. Still, Russia is in the top three countries for mining critical raw materials, with China at the top and the US between them. The EU being strong allies with just one of these three is a weak position, and one that they have started looking to rectify in recent years. Norway has an abundance of these materials and so it is easy to see how this will not only benefit the EU but Europe as a whole and especially Norway. With the EU diversifying their sources of critical raw materials, Norway stands to profit greatly from exporting to Europe, as well as its own industry developing both in economic terms and green industrial terms.
All of these factors, along with the new Norwegian Mineral Strategy, mean that Norway may well be catapulted up in the ranks of top critical raw material exporters, and Norway itself will only benefit from this in profit and political power. The benefits to industry will also give the country a swathe of new jobs and the ability to develop green solutions and industries to benefit the world and humanity as a whole.
Germany, a nation lauded for its technological excellence and dedication to ecological sustainability, stands at a crucial juncture concerning the trajectory of its mining and resources sector.
Throughout history, mining has been a cornerstone of Germany’s economy. However, today, this industry grapples with an array of challenges that necessitate a harmonious approach. Balancing the imperatives of economic expansion, environmental preservation, and reducing dependence on foreign resources is of paramount importance.
Germany, renowned for its technological prowess and commitment to ecological sustainability, stands at a critical juncture in shaping its mining and resources sector’s future.
Throughout its history, mining has been a linchpin of Germany’s economy. Nevertheless, the sector now confronts an array of challenges that necessitate a harmonious approach. Striking a balance between economic expansion, environmental preservation, and reducing reliance on foreign resources has become imperative.
Juergen Wallstabe, representing the German-Australian Chamber of Industry and Commerce, points out that although mining activities have waned across Europe over several decades, Germany has expanded its global presence in the resources sector. High-tech METS companies in Germany are increasingly exporting innovative and technologically advanced solutions worldwide.
Wallstabe is optimistic that IMARC will provide a platform for established and emerging German firms to enhance their reputation for technological excellence and innovation.
“Germany’s leading position in engineering and manufacturing has resulted in a world-leading METS sector,” Wallstabe emphasizes. “We are convinced that on the one hand, German METS companies can support the Australian and other mining industry operators to reach their targets related to safety, productivity, efficiency, and decarbonization. On the other hand, Australia is a valuable partner for Germany’s resources needs.”
IMARC has been highlighting the industry’s environmental impact and its role in fostering a sustainable, decarbonized economy in recent years. A particular focus has been on the often-unwelcome legacy of mining operations, which have left lasting scars on landscapes, disrupted ecosystems, and polluted water sources.
Wallstabe highlights that IMARC offers an opportunity to showcase how Germany’s emphasis on environmental protection has led to stringent regulations for mitigating these legacy impacts.
“Germany’s commitment to remediating and restoring abandoned mining sites demonstrates our dedication to healing environmental wounds. IMARC offers a chance to share our experiences and learn from others facing similar challenges,” he notes.
Energy security is back in the spotlight in Europe, partly driven by the ongoing conflict in Ukraine and the need for reliable energy supply. Germany’s ambitious Energiewende (energy transition) plan aims to phase out nuclear power and significantly reduce carbon emissions by promoting renewable energy sources. Consequently, the focus has shifted towards sustainable mining practices supporting the production of materials crucial for renewable energy technologies, such as lithium for batteries and rare earth elements for wind turbines and solar panels. This presents an opportunity for the mining sector to contribute positively to Germany’s energy transformation.
Wallstabe notes, “To manage the energy transition, Germany’s and Europe’s need for critical minerals will increase dramatically for the foreseeable future. Australia is already and will continue to be a key player in securing a steady supply of critical minerals. Wind turbines need steel, copper, and strong magnets with rare earths minerals. Batteries consist of a wide range of critical minerals like Lithium, Manganese, Copper, Nickel, Cobalt, and the hydrogen industry needs Platinum, Iridium or Scandium. All resources that Europe struggles to produce in sufficient quantities.”
IMARC spokesperson Paul Phelan underscores the significance of Germany’s strong representation at the event. He believes that delegates can anticipate a showcase of Germany’s renowned innovation, particularly within the mining sector.
“It is clear that Germany’s public and private sectors are investing in the long term, with its research institutions and companies actively exploring novel technologies to enhance resource extraction efficiency, reduce environmental impacts, and improve worker safety,” says Phelan.
“Automation, digitalization, and artificial intelligence are becoming integral to modern mining practices, enabling better resource management and reduced ecological footprints. IMARC offers an opportunity to witness how a technological giant like Germany is leading the way.”
Germany’s mining industry, like that of other advanced nations, is closely linked to global supply chains. Ensuring ethical sourcing and responsible procurement of minerals from abroad becomes crucial in upholding the nation’s commitment to sustainability.
Finland, on the other hand, adopts a different approach to secure critical minerals, emphasizing e-waste recycling. Birgit Tegethoff, Senior Advisor at Business Finland Australia, highlights Finland’s leadership in e-waste recycling, with companies like Metso pioneering hydrometallurgical battery black mass recycling.
“The Finnish mineral industry has the circular economy heavily ingrained in its DNA, giving it a competitive edge in the global market. By increasing the use of recycled components in battery production, we can reduce the carbon footprint throughout our battery supply chain and lessen our dependence on international supply chains,” notes Tegethoff.
Developing strategic international partnerships in the green minerals sector is a top priority for Finland. Ilkka Homanen, the head of the Finnish delegation, has extended an invitation to Australian research institutes and the broader resource industry to engage at IMARC 2023 and join consortia aimed at solving green minerals value chain challenges.
Rolf Kuby, Director-General of Euromines, asserts that the issues facing Germany and Finland are not unique but are felt across Europe. He emphasizes the need to build a degree of open strategic autonomy and future-proof value chains.
Phelan highlights Europe’s profound energy transformation in alignment with the EU’s sustainability and innovation goals. He believes that events like IMARC provide a platform for leading economies to secure their “resources resilience.”
In addition to the Germany pavilion, a 90-minute German Program will be featured at IMARC 2023, curated by the German delegation and Chamber within the Global Opportunities Theatre.
Other programs featured at the event this year include Canada, Australia, Mongolia, Ecuador, Chile, Saudi Arabia, Quebec, Ontario, and South Korea.
European Lithium Ltd (ASX:EUR, OTCQB:EULIF) has taken another step toward becoming Europe’s first local producer of battery-grade lithium on being granted new mining licenses and extensions which double the footprint of the advanced Wolfsberg Lithium Project in Austria.
A public hearing conducted by the Austrian Mining Authority has resulted in the new licenses and extensions, which come as the continent marches on in the strengthening transition to green energy.
The company has been granted six new mining licenses while three existing licenses have been extended with one of the extensions applying to the existing Andreas field and two to the newly assigned Barbara field.
Austrian fast-track
European Lithium chairman Tony Sage said: “The grant of these mining licenses further reinforces our belief that Wolfsberg will be the first local producer of battery-grade lithium in Europe to fuel the green energy transition.
“The Wolfsberg Project benefits from Austria’s robust and mature mining industry that reflects many of the aims of the EU’s proposed Critical Raw Materials Act, including a fast track for critical projects like ours.”
Beyond existing resource
Wolfsberg Project tenement map.
EUR’s mining licenses now extend beyond the existing Wolfsberg lithium resource and almost double the project’s footprint.
There are now 20 licenses covering the Wolfsberg Project, which almost double the footprint for the proposed underground mining operations.
The licenses and extensions flow on from the Wolfsberg Project Definitive Feasibility Study (DFS) released in March 2023 in which mine planning and design incorporated an expanded resource.
At the time, EUR identified several mining fields extending outside existing license areas that had the potential to be mined in the future.
Since the DFS, the company applied for a new mining field, called Barbara, adjacent to the existing mining field called Andreas, which contains 11 mining licenses.
The Barbara mining field provides the company with six new licenses along with the three extended licenses.
READ: European Lithium strengthens critical minerals portfolio on securing Austrian projects with sample grades up to 3.98%
European Lithium has also recently increased its Austrian critical minerals portfolio by securing other projects separate to Wolfsberg which have returned sample grades up to 3.98% and have potential to add to the company’s lithium bounty.
“Significant upside”
“The grant of the new mining licenses and license extensions provides significant upside to mining operations in the future,” the company’s CEO, Dietrich Wanke, said.
“We are encouraged by this successful grant as we move toward operational readiness of the Wolfsberg Project,” he added.
COVAS DO BARROSO, Portugal—Tucked away in the mountains of northern Portugal, about two hours northeast from the country’s second-largest city of Porto, sits this idyllic farming village. It is home to under 200 people, most over the age of 60, with the surrounding region most famous for its Barrosão cattle, a protected species prizedfor its meat. The nearest town, Boticas, is a 20-minute drive away, and if you stand on the hilltop, the only sounds you hear are the cattle, song birds and insects.
Covas, however, is set to play host to the green-energy transition in its rawest form. Just a third of a mile away from the houses of Covas do Barroso is one of Europe’s richest lithium deposits—the silvery metal used in electric-vehicle batteries—and a planned mining operation to dig out the mineral.
Europe’s Mining Boom
With demand for critical minerals surging, European governments want to exploit resources closer to home.
Locals are worried about the environmental impact as well as the blight on the village presented by the mine. Speaking to locals, the word “mina” often draws a cringe, and a protest is scheduled later this month. “Our biggest opposition to the mine is that they want to destroy us,” said Nelson Gomes, president of Associação Unidosem defesa de Covas do Barroso, the local protest group. “The intensity of what they want to destroy, but also the proximity. It’s basically inside the village.”
Governments and companies around the world are scrambling to find new sources of critical materials—and in doing so they are easing the approval process for projects that once took years or sometimes more than a decade to get off the ground. Additional supplies of metals like copper, nickel and lithium are going to be crucial to meet the growing demand for the energy transition—with the wiring, magnets, motors and battery cells used in green technologies such as electric vehicles, wind turbines and batteries for storage all requiring mined minerals.
“No doubt there is a real demand story,” said Alex Gorman,mining analyst at U.K. investment bank Peel Hunt. “We are talking about a 35-fold increase in lithium demand and we do not have any large-scale lithium mines in Europe. It’s a massive problem.”
But as governments fast-track approvals on such projects and struggle to convey the importance of efforts to secure materials for the green-energy transition, resistance is growing among locals like the Covas residents who stand to feel an impact and environmentalists who urge caution when moving forward with projects in sensitive ecosystems.
Left: A stream dug by Nelson Gomes to manage the flow of water from the river over his farmland. Right: Nelson Gomes’s Barrosão cattle, a protected species.YUSUF KHAN/THE WALL STREET JOURNAL
Race for resources
The proposed Covas site is one of the nearly 50 mines now expected to open across Europe by 2030.In Germany, Vulcan Energy Resources is looking to open a lithium mine, harnessing a new technology for extracting the battery metal from brine. In Sweden, Copperstone Resources is hoping to reopen a brownfield mine site to extract the red metal, while Adriatic Metals has just started mining for silver and zinc in Bosnia, with more projects planned from Finland to Greece.
“It’s definitely a [mining] renaissance,” said Rebecca Campbell, global mining and metals lead at law firm White & Case.“For many of us who have been working in the sector, it’s the first time we are seeing primary projects in Europe during our careers.”
“We’re starting to now see material that’s on its way through the supply chain from European mine[s],” she added.
The situation in Europe and the U.S. isstrikingly similar, according to Jayni Hein, of counsel at law firm Covington & Burling and former senior director for clean energy, infrastructure and the National Environmental Policy Act at the White House Council on Environmental Quality.
“There’s an uptick in interest in domestic manufacturing and production in the U.S.,” driven by the passage of the climate law known as the Inflation Reduction Act in 2022, said Hein. She said the IRA and other acts have increased funds available for federal agencies to accelerate and improve permitting but noted that working with individual states and their legislatures remains a challenge. “We’re trying to foster a permitting landscape that is both efficient and responsible.”
In Europe, the mining renaissance comes after years of nearly no new mining activity on the continent. Usually, opening a new mine takes 10 to 15 years, often because permitting can take years, according to Peel Hunt’s Gorman. She said a lack of staff with field knowledge has been an issue as well as negative attitudes toward mining in general.
The Covas deposit
In 2017 Savannah Resources, a London-listed mining company, identified the Covas deposit as a possible area to mine, hoping to cash in on green demand. Geological studies of the area stretching back to the 1980s had found possible lithium reserves. The project, however, seemed to have stalled after failing to get the backing of Portugal’s environmental agency.
That changed this year. In May, Savannah Resources received permitting approval from the environmental agency allowing the company to move forward with pre-feasibility studies that include mining one small site to show how it would proceed with a full-scale operation. The approval happened to coincide with the European Union’s proposing critical-minerals legislation to speed up mine approvals across the bloc with various measures, including limiting environmental approval review times to two years.
Left: A layer of spodumene within the host rock that Savannah Resources intends to mine. Right: Savannah Resources sample shed.YUSUF KHAN/THE WALL STREET JOURNAL
For Savannah Resources, mining in the Portuguese hills for spodumene, the base rock recovered for lithium extraction, has become more attractive since the government updated its mining laws in 2021 to be more open to exploitation. The companyaims to dig four mine sites in the valley, with the largest 1,600 feet across, about the length of five football fields. Currently, Savannah Resources is mining the smallest of those sites, with some of the proceeds used in the local ceramics industry because the company hasn’t yet won approval to process lithium.
“Some of the rock that’s being mined for spodumene—that is currently being mined for ceramics. Well, what we are doing instead of using it all for ceramics, is we’re taking the spodumene out and turning that into lithium hydroxide,” said Dale Ferguson, chief executive of Savannah Resources.Lithium hydroxide is used to make cathode materials for lithium-ion batteries.
Locals worry the Covas river will be used by the mine. Savannah Resources, which has set up two offices in the municipality, has said it would strictly avoid that and instead build reservoirs to store rain water. But Gomes, the local opposition leader, is doubtful. Savannah Resources “will not take water from the river but they need to take it from somewhere. The river Covas springs 20 kilometers away, so they will take it before the river starts, even if not actually using the river.”
Shifting sentiment?
Local backlash against new mines isn’t uncommon. The industry has a long history of environmental destruction, poor relations with local communitiesand deadly disasters. In 2021, local opposition derailed Rio Tinto’s lithium project in Serbia, though the company is still confident the mine will open in some capacity at some point.
However, governments want and need a secure supply chain of metals and minerals. Most critical minerals are processed in a relatively small number of countries with the threat made more apparent last month after China said it would introduce export restrictions to germanium and gallium—two critical minerals used to make semiconductors. Prices skyrocketed as consumers were suddenly unsure if they would have the raw materials needed to make chips for cars, phones and other tech.
“There are minerals that are needed with the new green transition, resources that you did not need or have any use for before, which are now important for society, for nations, to have. It’s so much needed,” said Jessica Polfjärd, member of the European Parliament and Sweden’s Moderate Party.
Polfjärd said that in Europe, attitudes in governments are starting to shift toward mining, adding that it is up to those lawmakers to help explain the benefits and need for exploiting mineral resources at home.
Left: Local villagers have been protesting the opening of the mine. Right: The village of Covas do Barroso within the Serra de Dornela river valley.YUSUF KHAN/THE WALL STREET JOURNAL
“There is always more public response when you start something new,” she said. “There is no difference if you want to have a mine or a shopping mall. To put something new in place—it’s harder than existing ones.”
Despite the strong local opposition, Portugal still wants to mine its resources. “We have a responsibility to do so since we have the highest lithium resource [in Europe],” said Ana Fontoura Gouveia, Portugal’s secretary of state for energy and climate.
Fontoura said that there is a possibility that the land for the mine, which is owned largely by the community and private owners, could be expropriated but she hoped an agreement would be reached instead. That view is echoed by Savannah Resources.
“Portugal is a front-runner with adapting laws for environmental and social standards,” Fontoura said. “Critical raw materials have economic value and social value and we can fulfill that by high environmental and social standards. It’s important to convince [people] this is the way forward.”
The cheese wheels – weighing in at 40kg each – fell in their thousandsfrom the top of his warehouse after a shelf broke and it took firefighters 12 hours to retrieve Chiapparini’s body underneath his beloved Grana Padano.
But that’s not the only shock lately for Europe – it’s facing a domestic raw material production crisis for a range of critical minerals it requires for EVs, clean energy production and other technologies.
Moves such as China’s recent export restrictions of its monopoly on gallium and germanium – critical components in semiconductor chips – and high global demand have sparked the EU to hastily pass legislation to make its region more self-reliant in the mining, processing and recycling of such minerals.
34 of them in fact. The EU’s Critical Raw Materials Act was enacted earlier this year to secure future supply for downstream processing and manufacturing of critical metals and minerals as it largely imports most elements from third-party countries outside the EU. Let’s find out why:
Critical minerals the EU has mandated for domestic production and processing capabilities. Source: European Union.
Don’t let the wheels fall off
European mining is old. Centuries-old. Yet nowadays, its homegrown mining is largely based on fossil fuel extraction and traditional mining of meagre amounts of gold and silver – importing most other minerals that are increasingly in demand as we pivot to net-zero emissions technologies.
Past colonialism by the majority of European powers – where they pillaged natural resources and brought them back home – has manifested into the necessary importation of a range of raw materials from places like China, Africa, Russia and more for far too long.
Thus creating a dependency on third-party nation-states outside of the EU for high-demand critical minerals.
It may sound cheesy to say this, but this lack of domestic critical mineral production could mean Europe gets economically crushed by its past successes.
Europe is set to become the global leader in EV penetration. Source: Citi.
Basically, if the EU doesn’t want the wheels to fall off its prestigious US$156bn (6.24% of total EU exports) car manufacturing sector and clean energy targets, it’s going to need to shore up stable supplies of these minerals in-house, otherwise OEMs are going to set up shop elsewhere.
The good news is, they’re actually doing something about it.
EU critical minerals mandate
The Raw Materials Act sets these benchmarks along the strategic raw materials value chain and for the diversification of the EU supplies for:
at least 10% of the EU’s annual consumption for extraction
at least 40% of the EU’s annual consumption for processing
at least 15% of the EU’s annual consumption for recycling
and no more than 65% of the EU’s annual consumption from a single third country
Lofty goals, as currently, China supplies the EU with 80% of its REEs and imports high percentages of other strategic minerals used in battery manufacturing, such as lithium, nickel, copper and cobalt.
In March 2023, the European Union also proposed the Net Zero Industry Act, which aims to meet 40% of its needs for strategic net zero technologies using domestic manufacturing capacity by 2030.
These technologies explicitly include battery and storage, and for batteries, the aim is for nearly 90% of the European Union’s annual battery demand to be met by EU battery manufacturers, with a combined manufacturing capacity of at least 550GWh in 2030, in line with the objectives of the European Battery Alliance.
“The EU’s demand for base metals, battery materials, rare earths and more are set to increase exponentially as the EU divests from fossil fuels and turns to clean energy systems which necessitate more minerals,” the European Council says.
“The EU green transition will require the build-up of local production of batteries, solar panels, permanent magnets, and other clean tech. Abundant access to a range of raw materials will be needed to address the corresponding demand.”
Ergo, Europe is hungry to mine. And lucky for EU, there’s a bunch of ASX-listed explorers and mine developers looking to feed into its domestic supply chain.
So who’s out there?
In Austria, Battery Age Minerals (ASX:BM8) owns the Bleiberg project – once a major producer of zinc and lead; and at one point was among the largest primary germanium producers globally.
The explorer’s now added germanium to its “to-do” list at Bleiberg, where gallium mineralisation has also been found through historical workings at the project, recently announcing an expansion of its tenements.
“We are pleased to have secured additional ground adjacent to our existing Bleiberg Zinc-Lead-Germanium project,” BM8 MD Gerard O’Donovan said last month.
Also in Austria, Tony Sage-backed European Lithium (ASX:EUR) is concentrating on its Wolfsburg hard rock lithium project, recently selling its non-core Australian tenement around the Mt Anketell iron ore deposit in the Pilbara, keeping it laser-eyed on battery commodities for the European market.
Wolfsberg’s current MRE is 12.88Mt @ 1% Li2O and its DFS has highlighted the project’s economic viability – especially since it has an offtake agreement with BMW, a US$125m share subscription facility and an agreement with Saudi-backed Obeikan Investment Group.
EUR is about ~65% financed, and is looking at finalising a funding package for infrastructure, the construction start and resource extension drilling at the Zone 2 prospect which is currently not included in the MRE.
Exploring copper and gold at Sweden’s historic 1,000yr old Falun mine is Alicanto Minerals (ASX:AQI), which has recently received commitments to raise $3m to kickstart drilling at the project.
Multiple high-priority targets have been identified, comprised of both copper-gold and zinc-copper-lead, especially along 3.5km of mineralisation where limited drilling was conducted last year.
Alicanto has also been conducting step-out drilling at its Sala silver-zinc project, also in Sweden, which has a current resource of 9.7Mt, with recent re-assaying of historic cores showing 1.1m @ 1,326g/t silver, 0.8% zinc and 6.6% lead; as well as 3.9m at 737g/t silver, 1.2% zinc and 11.8% lead near the historic Bronäs mine.
It seems like Sweden’s becoming a bit of a hotspot for mining again for ASX juniors looking to boost Europe’s green tech push.
Zinc of Ireland (ASX:ZMI) has its eyes on zinc mineralisation at its Rathdowney project where it controls 75 prospecting licences across 2,500km2 with a trend that goes for a whopping 130km.
Previously mined for zinc and lead, ZMI is looking to further exploration on the back of a 2020 MRE of 11.3Mt @ 9% Zn+Pb (7.8% Zn and 1.2% Pb) @ a 5% Zn equivalent cut-off.
ZMI reckons it controls “arguably one of the most prospective land packages for high grade, large tonnage, Zn/Pb deposits in the world”.
Samples are actively being taken at the Rathdowney trend and the explorer is assessing geochemical assays.
Off to the Balkans now and precious metals explorer Adriatic Metals (ASX:ADT) is on a tear after releasing a 93% increase of the indicated and inferred MRE of its Rupice deposit – part of its Vares silver project in Bosnia and Herzegovina last month.
It now stands at an impressive 21.1Mt @ 156g/t Ag, 1.2g/t Au, 4.3% Zn, 2.8% Pb, 0.4% Cu, 27% BaSO4 (reported above a cut-off grade of 50 g/t AgEq) for a contained 105Moz Ag, 789koz Au, 913kt Zn, 581kt Pb, 88kt Cu and 39kt Sb.
The near-term producer says construction is 84% complete (as of June 30 this year) and first concentrate is expected in November.
Based off the results, Adriatic is now raising US$30m to complete construction and prove up more resources.
“Following a very successful exploration campaign and the recently announced MRE at Rupice and Rupice Northwest, we are pleased to announce an equity placing of US$30 million to fund an expanded and accelerated exploration programme in 2023 and 2024,” ADT MD Paul Cronin says.
“Rupice and Rupice Northwest remain open and there are numerous regional targets such as Droskovac, SP1 and SP2 that have exciting prospects.
“We believe this exploration programme will deliver impactful results by more aggressively testing priority targets across our emerging high-grade polymetallic district.”
Finally – and staying in Bosnia and Herzegovina – Lykos Metals -LYK (ASX:) is making strides towards exploration approvals for its highly-prospective copper-gold tenements at the Sinjakovo project after being hamstrung by red tape.
“After nearly two years of intensive negotiations, the Government of the Republic of Srpska has taken a decisive stance to protect foreign investments in geological exploration,” LYK CEO Milos Bosnjakovic says.
“This represents a momentous step forward not only for our company but also for the economy of the Republic of Srpska, and the local municipalities where we have been actively engaged since listing and intend to conduct future exploration activities.”
While Alicanto, European Lithium, Battery Age Metals and Zinc of Ireland are Stockhead advertisers, they did not sponsor this article.
