MINEX Forum

Tag: Critical raw materials

  • Ukraine’s Critical Materials Sector: Challenges and Investment Opportunities

    Ukraine’s Critical Materials Sector: Challenges and Investment Opportunities

    Ukraine’s critical materials sector is at a crossroads as industry experts and policymakers seek solutions to investment barriers and economic growth challenges. The recent conference, Strategic Resources of Ukraine: Scenarios for the Development of the Subsoil Use Industry, held as part of the Economic Growth Strategy of Ukraine until 2040, outlined key issues and opportunities in the mining sector. The event was organized in collaboration with the Boston Consulting Group and the think tank We Build Ukraine.

    Ukraine’s mining industry, a major contributor to GDP and exports, is facing significant obstacles, including asset losses, supply disruptions, and infrastructure damage due to the ongoing conflict. While the Kryvyi Rih basin remains under Ukrainian control, non-ferrous metals, including rare earth elements and precious metals, present potential growth areas. However, challenges such as outdated geological data, a lack of strategic policies, and complex land acquisition processes hinder investment.

    On a global scale, access to critical raw materials is essential for industries, technological progress, and renewable energy development. However, risks such as high geographic concentration of production, lengthy project development times, and environmental concerns contribute to market volatility.

    To attract investors, Ukraine must address several barriers, including the absence of a clear state policy on critical materials, outdated classification systems, and limited support for businesses seeking mining rights. Additionally, the country lacks fiscal incentives, export support, and mechanisms to insure against war-related risks.

    Despite these challenges, Ukraine remains an attractive destination for investment in critical raw materials. By creating economic clusters and strengthening policies, the country can enhance its economic resilience, improve energy independence, and attract international investors. A strategic approach to resource development could unlock Ukraine’s vast raw material potential, contributing to long-term economic stability.

  • EU’s Pro-Business Roadmap Emphasises Mining Amid Economic Shift

    EU’s Pro-Business Roadmap Emphasises Mining Amid Economic Shift

    On Wednesday  29 January 2025, the European Union introduced a pivotal roadmap aimed at making Europe more business-friendly after years of prioritising green goals. With US President Trump’s aggressive trade policies and China’s technological advancements, the EU seeks to bolster growth by alleviating corporate burdens.

    “We need to reignite Europe’s innovation engine,” EU chief Ursula von der Leyen told a news conference to present the “competitiveness compass” — the first major initiative of her second mandate.

    Specific measures proposed:

      • Creating a new legal regime for innovative companies across the EU
      • Facilitating long-term energy agreements and grid investments
      • Providing targeted aid for industrial decarbonisation
      • Revising competition rules to allow creation of European tech giants
      • Promoting more mining in Europe for critical raw materials
      • Removing barriers in the EU single market for key sectors
      • Creating a “European savings and investments union” to boost startup funding

    The plan aims to streamline regulations, reduce energy costs for businesses, and support the development of green technologies. To achieve this, the EU will revise numerous laws, including those related to environmental standards and supply chains, to reduce the burden on companies.

    A key element of the strategy is to increase the EU’s self-sufficiency in critical raw materials, such as rare earths, which are essential for many advanced technologies. The EU currently relies heavily on imports from China and other countries for these materials.

    To address this dependency, the EU plans to encourage more mining within its borders. The European Commission has already received 170 mining projects and aims to facilitate the permitting process. The plan also includes provisions for joint purchases of critical raw materials and international partnerships to secure supply lines.

    This initiative has sparked concerns from environmental groups, who worry that it could lead to the weakening of environmental protections. However, the EU maintains that it remains committed to its climate goals, including achieving carbon neutrality by 2050.

    The EU’s new plan reflects the growing global competition for resources and technological dominance. By focusing on mining and streamlining regulations, the EU aims to strengthen its industrial base and secure its position in the global economy.

  • EU Collaborates with PwC and Sféra on €9 Million Critical Raw Materials Platform

    EU Collaborates with PwC and Sféra on €9 Million Critical Raw Materials Platform

    The European Union has appointed a consortium of PriceWaterhouseCoopers EU Services and Slovak software firm Sféra to develop a €9 million platform for joint purchasing of critical minerals and energy. The platform, set to launch in 2025, will include mechanisms for raw materials, hydrogen, and energy products like natural gas and biomethane.

    This initiative forms part of the Critical Raw Materials Act (CRMA), which aims to reduce reliance on China by bolstering domestic production of essential resources for technologies like electric vehicles and wind turbines.

    The CRMA follows the success of AggregateEU, a gas purchasing platform launched during the 2022 energy crisis. While the platform helped consolidate resources, critics argue its effectiveness in ensuring affordable prices and market influence remains limited.

    With eight proposals received, including bids from Deloitte and Metalshub, this latest project underscores the EU’s focus on securing resource supply chains and advancing its green energy goals.

  • EU Project Reveals Delicate Balance Between Mining and Environmental Protection

    EU Project Reveals Delicate Balance Between Mining and Environmental Protection

    In a groundbreaking study addressing the complex intersection of extractive activities and environmental conservation, the European Union’s CIRAN project has uncovered critical insights into how mining can coexist with protected natural areas.

    Key Findings Highlight Significant Overlap

    Researchers from the Geological Survey of Finland discovered that approximately 85% of Critical Raw Material (CRM) deposits are located within 5 kilometers of environmental protected areas. The project analyzed 23,779 CRM occurrences across EU member states, revealing the intricate spatial challenges facing resource extraction.

    Surprising Discoveries

    Roughly 69% of active mines with reported CRMs are located close to protected areas – The study identified numerous examples of successful coexistence between mining operations and environmental preservation

    Good Practices Emerge

    The CIRAN project identified several key strategies for balancing industrial needs with environmental protection:

    1. **Governance Innovations**: Development of adaptable permitting processes that support circular economy principles

    2. **Corporate Responsibility**: Mining companies implementing extensive environmental impact assessments

    3. **Community Engagement**: Transparent communication and local community involvement

    4. **Technological Advancements**: Adoption of innovative, low-impact extraction techniques

    Looking Forward

    Project leaders emphasise that the research is not just about identifying challenges, but developing practical solutions. Upcoming publications will include comprehensive guidelines for mine closure and sustainable resource management.

    Get Involved

    Interested parties can follow the project’s progress through: – Project Website: [CIRAN Project Results](https://ciranproject.eu/results) – LinkedIn Discussion Forum: Sustainable Management in the Extractive Sector *The CIRAN project represents a crucial step in reconciling economic development with environmental conservation, offering hope for a more sustainable approach to resource extraction.*

    ### Project Writers – Nike Luodes – Nikolas Ovaskainen – Hannu Panttila – Toni Eerola – Martina Bertelli

  • EU Highlights Recycled Materials in Push for Sustainability

    EU Highlights Recycled Materials in Push for Sustainability

    The European Union is intensifying efforts to integrate recycled raw materials into its sustainability strategy, addressing critical challenges in the supply chain for green technologies. Environment Commissioner Jessika Roswall highlighted the underutilization of secondary materials like lithium, cobalt, and copper, which are crucial for the EU’s transition to climate neutrality by 2050.

    The EU’s Critical Raw Materials Act, introduced in 2023, targets 40% domestic production of strategic raw materials by 2030, complemented by streamlined mining permits and high environmental standards. This initiative aims to reduce dependence on China and the U.S. while boosting the EU’s resilience.

    Complementing this, the Clean Industrial Deal—slated for February 26—will outline financial incentives, trade agreements, and measures to curb unfair competition. Proposals include pooling resources and creating platforms for collective purchasing of essential materials. Businesses are pressing for immediate action to secure a sustainable future and maintain global competitiveness.

  • EU Bolsters Lithium Supply with Latin American Partnerships

    EU Bolsters Lithium Supply with Latin American Partnerships

    The European Union is intensifying collaborations with Latin America to secure critical raw materials, particularly lithium, essential for its energy transition. Facing a 12-fold rise in lithium demand by 2030 and 21-fold by 2050, the EU relies heavily on Chile, which supplies 79% of its refined lithium. A trade agreement with Chile, effective February 2025, introduces a chapter dedicated to energy and raw materials—an EU first.

    Additionally, the EU has reached a preliminary deal with Mercosur to lower tariffs and export restrictions. Brazil, the region’s leading supplier of critical raw materials, and other Latin American countries extract 25 of the 34 materials on the EU’s critical list.

    While these partnerships offer economic opportunities, they face environmental and social challenges. Over 40% of environmental conflicts in Latin America are linked to mining activities. Concerns persist about the sustainability of water-intensive lithium extraction, despite EU assurances of provisions for sustainable mining and environmental assessments.

  • Key Barriers in Kazakhstan’s Mining Sector Hinder Investment Climate

    Key Barriers in Kazakhstan’s Mining Sector Hinder Investment Climate

    Barriers within Kazakhstan’s mining sector have been identified as a major hurdle for investment in the country. A recent consultation document on proposed legal amendments highlighted concerns about access to mineral rights, including convoluted regulations and a lack of automation in government services.

    Further issues stem from inconsistencies between mining regulations and other areas of law, such as tax, water, land and environmental legislation. These inconsistencies create uncertainty for mining companies and hinder their ability to meet their licence obligations.

    Regulatory and Procedural Barriers

    • The current regulatory framework for mining lacks clear and efficient procedures, leading to complexities in obtaining and exercising mining rights. This includes inadequate automation of state services, insufficient regulation of state information resources, and overlapping legislation in areas such as ecology, land use, and taxation.

    Legislative Inconsistencies

    • There are inconsistencies between the mining code and other related legislation, such as water, land, and environmental laws. For example, the mining code prohibits operations on certain territories, including those within water fund lands, which contradicts previous legislation and restricts activities like sand extraction from river beds.

    Specific Issues

    • Unclear regulations on the reclamation of mining sites, conflicting provisions with the Civil Code regarding contract and license obligations, and the lack of clear guidelines on servitude payments and compensation for land use are significant issues.
    • The prohibition on mining in certain areas, such as those with high natural methane content without prior degasification, creates operational challenges due to the absence of specific norms and authorities to set these standards.

    Institutional and Administrative Challenges

    • The process of forming the State Fund for Mineral Resources Management is marred by lack of transparency and coordination between state bodies. This leads to inefficiencies in the allocation of mining rights and the management of mineral resources.
    • The requirement for exclusive rights to specific territories is not adequately ensured, leading to conflicts between different mining users.

    Practical Challenges

    • The use of experimental-industrial mining is often abused, hiding industrial-scale extraction under the guise of exploration. This practice undermines the integrity of the exploration phase.
    • The high cost of acquiring machinery for small-scale mining operations is a significant financial burden, suggesting the need for more flexible arrangements such as equipment rental.

    International Comparisons and Recommendations

    • Kazakhstan ranks 56th out of 84 countries in the Investment Attractiveness Index by the Fraser Institute, with negative evaluations in legal, tax, and labor legislation, as well as in geological data quality. To improve, Kazakhstan should analyze and adopt best practices from other countries, engage in consultations with stakeholders, and streamline regulatory processes to enhance transparency and efficiency.

    Addressing these issues is crucial for improving Kazakhstan’s investment climate, particularly in the mining sector, and aligning it with international standards to attract more foreign and domestic investment.

  • Kyrgyzstan Paves New Path in Mining Sector with Focus on Critical Raw Materials

    Kyrgyzstan Paves New Path in Mining Sector with Focus on Critical Raw Materials

    Kyrgyzstan is on the verge of a transformative shift in its mining industry, announcing plans to issue licenses for the extraction of critical raw materials (CRMs)—a strategy that seemed improbable just five years ago. This evolution follows extensive political reforms under President Sady Japarov, who has been pursuing new revenue streams since his election in late 2020.

    Traditionally, Kyrgyzstan has depended on mining, especially the Kumtor gold mine, due to a lack of natural gas and oil reserves. The Kumtor mine, near Lake Issyk-Kul, was initially estimated to hold 514 tons of gold but has faced controversies over environmental issues and a cyanide spill in 1998, impacting local communities and tourism.

    Public disapproval of mining activities has intensified, particularly after the 2019 Kyzyl-Ompol uranium mining controversy where nearly 30,000 citizens protested, leading to a moratorium on uranium and thorium mining due to environmental and health concerns. However, as the demand for CRMs increases globally—driven by the European Commission’s call for energy transition and secure CRM supplies—Kyrgyzstan is revisiting its mining prospects.

    In June 2024, Kyrgyzstan’s parliament lifted the uranium mining moratorium, encouraging new exploration nationwide. Amendments in subsoil use and biosphere territories regulations aim to streamline CRM resource development.

    Kyrgyzstan, however, faces obstacles in attracting foreign investment due to a fraught history with international mining companies, notably the Centerra dispute over Kumtor. Yet the government is eager to attract both domestic and international partners, with recent talks involving the Zhicun Lithium Industry Group for lithium mining.

    While mining activities, such as the start of operations at Kyzyl-Ompol, underscore the government’s commitment, environmental concerns persist. Incidents like a glacier damaged by a Chinese coal mining company and a radioactive waste spill have renewed public apprehensions, evoking memories of past controversies. Kyrgyzstan’s shift toward CRM mining raises questions about sustainable development, with hopes to avoid previous missteps and create long-term economic benefits for the country.

     

  • EU Faces Challenges in Critical Raw Material Strategy Amid Global Race for Supply Chain Resilience

    EU Faces Challenges in Critical Raw Material Strategy Amid Global Race for Supply Chain Resilience

    While the Brussels Effect has driven strict regulatory standards for Critical and Strategic Raw Materials (CSRM), Europe may risk falling behind other global players in building a resilient supply base. An analysis by the French Institute of International Relations (Ifri), a Paris-based think tank, evaluates European de-risking policies in the context of international concerns over reliance on a few key suppliers, particularly China.

    China’s export controls on materials like germanium, gallium, and rare earths underscore the risk of critical dependencies as a geopolitical tool. In response, OECD countries are emphasizing national security, strategic autonomy, and the governance of CRM supplies. The EU and the United States have taken steps to diversify their supply chains. The EU’s Critical Raw Materials Act (CRMA), part of the Green Deal, emphasizes sustainability and autonomy, while the US focuses on national security through investments like the Development Finance Corporation (DFC). Japan began addressing CRM dependencies as early as 2010.

    To counterbalance China’s Belt and Road Initiative, the EU and US have increased CRM partnerships since 2021. However, Ifri’s analysis stresses the need for these partnerships to yield immediate, tangible results. Countries in the Middle East are also integrating into CRM value chains, while resource-rich developing nations seek to retain more local value through processing and manufacturing.

    Despite progress, the EU faces financial constraints and public opposition, threatening its strategic CRM goals. According to Ifri, without external financing, Europe risks lagging behind global players such as the US, Japan, and the Middle East in developing a secure CRM base. The race for lithium, nickel, and rare earth elements (REEs), crucial for green energy goals, is reshaping geopolitics and intensifying international competition.

    To meet its target of extracting 10% of annual CRM demand by 2030, the EU must expand its mining and refiningcapabilities. The bloc requires at least ten new mines, 15 processing plants, and 15 recycling facilities by 2030, according to EIT RawMaterials. Public opposition, however, remains a significant obstacle. Sustainable mining expert Peter Tom Jones calls for public education to support modern, eco-friendly mining practices that prioritize environmental, social, and governance (ESG) standards. Nordic countries are seen as a model, with Jones stressing the importance of local CRM mining to reduce reliance on less sustainable sources abroad.

    Jones envisions a future where mining is safe, climate-neutral, and engages local communities as stakeholders. He describes a modern mine worker as one who operates high-tech machinery remotely, symbolizing the shift toward automated, climate-conscious mining that reduces traditional environmental impacts.

  • EU and Uzbekistan ink strategic partnership to secure critical raw materials

    EU and Uzbekistan ink strategic partnership to secure critical raw materials

    The MoU, inked by European Commission Executive Vice-President Valdis Dombrovskis and Uzbekistan’s Minister of Investment, Industry, and Trade Laziz Kudratov, underscores a mutual commitment to bolster cooperation in the realm of CRMs.

    The strategic partnership delineates several key areas of collaboration:

    • Integration of Sustainable CRM Value Chains: This entails networking, project proposal selection, joint project development, and trade and investment facilitation along the entire value chain.
    • Enhancing Resilience of CRM Supply Chains: Both parties will engage in dialogue to bolster transparency regarding investments, operations, and exports.
    • Mobilization of Funding: Efforts will be directed towards funding projects arising from the partnership, alongside the development of necessary infrastructure, such as clean energy supply.
    • Promoting Sustainable and Responsible Production: The partnership aims to ensure sustainable and ethical production and sourcing of CRMs.
    • Research and Innovation Collaboration: Both entities will share knowledge and technologies related to sustainable exploration, extraction, processing, and recycling of CRMs.
    • Capacity Building: Cooperation will extend to enforcing relevant rules, alongside training and skill development initiatives.

    Moving forward, subsequent to the MoU’s endorsement, the EU and Uzbekistan will collaboratively formulate an operational roadmap comprising concrete implementation actions.

    It will be important to improve the resilience of CRM supply chains and establish a dialogue to enhance the transparency of measures related to investments, operations and exports. Funding needs to be mobilised for projects resulting from the EU-Uzbekistan partnership and for the development of infrastructure, such as the development of clean energy supply.

    Next steps include agreeing on an operational roadmap with concrete steps towards its implementation, as part of the EU’s commitment to establishing mutually beneficial CRM value chain partnerships with resource-rich countries. Uzbekistan has the second-largest reserves of CRMs in Central Asia, boasting significant deposits of various minerals such as copper, molybdenum, and gold. The country’s mining strategy aligns with its ambitions to increase the processing of CRMs for both domestic and international industries, particularly in automotive and consumer electronics.

    In a broader context, this partnership resonates with the objectives articulated in the 2020 Action Plan for Critical Raw Materials and the EU’s external energy engagement strategy. It underscores the EU’s commitment to fostering mutually beneficial CRM value chain partnerships with resource-endowed nations.

    Uzbekistan, boasting the second-largest reserves of CRMs in Central Asia, possesses important deposits of minerals such as copper, molybdenum, and gold. The country’s mining strategy aligns with its aspirations to enhance CRM processing for both domestic utilization and international industries, notably the automotive and consumer electronics sectors.

    This strategic alliance aligns seamlessly with the EU’s Global Gateway strategy, a flagship initiative earmarked for sustainable and high-quality investments worldwide. The strategy aims to address the needs of partner countries, ensuring enduring benefits for local communities. As part of this initiative, the EU aims to mobilize up to €300bn in investments by 2027.

    The EU has already forged raw materials partnerships with several nations, including Canada, Ukraine, Kazakhstan, Namibia, Chile, Argentina, Zambia, the Democratic Republic of Congo, and the Autonomous Territory of Greenland, underscoring its proactive approach to securing critical resources and fostering global partnerships.

     

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