Britain must rapidly reverse its culture of “non-existent” investment in exploration for key green energy metals on home soil or face a future of Chinese dominance in an area vital to future economic security, a mining company boss has warned.
Galantas Gold Corporation, a Canadian company which holds exploration licences for some of the UK’s most promising geological deposits, is understood to have found a potential source of graphite, increasingly one of the world’s most sought-after materials for manufacturing electric vehicles, at a site it operates in Omagh, Northern Ireland.
But the firm’s chief executive has fired a shot across the bows of ministers and British industry by warning that the UK and other European countries are under-investing and can no longer rely on the exploitation of resources in the developing world to deliver the critical raw materials needed for the transition to clean energy.
The ability of the UK and allied countries to obtain their own longterm supplies of materials such as lithium or more obscure metals such as germanium, used in semiconductors, is at the core of a geo-political tussle with China in areas from electric vehicles to consumer electronics to wind power.
Beijing is already expected to have a substantial lead in providing electric cars in the UK when a ban on new petrol and diesel cars comes into force in 2030, causing some within the Government to raise concerns about the use of those vehicles to harvest vast amounts of data about the movements of ordinary Britons.
Galantas CEO, Mario Stifano, whose company is in the early stages of exploring metal deposits in a 217 square kilometre area of the Scottish Highlands, told that Britain was at risk of failing to understand and successfully exploit its own resources because of a lack of interest in funding the groundwork needed to establish the exact location and quantity of what are believed to be sizable deposits of materials such as copper, vanadium, zinc and gold.
In contrast to mining superpowers such as Australia and Canada, where large sums are spent to gain as full a picture as possible of unexploited deposits prior to mining, he said investors in the UK and other European countries tend to be interested only in mining projects which are close to going into production and otherwise tend to prioritise “buying shares in a Unilever or a Glaxo”.
Mr Stifano said: “The amount of exploration that has occurred in Canada and the US looking for minerals is hundreds if not thousands of multiples more than what has been spent in the UK.
“What is lacking is support for exploration companies in order to build knowledge about these kinds of deposits so they can get into production. We need zinc, copper, cobalt, lithium, graphite and so on. It’s all over Europe [and] a lot of it is in the United Kingdom and we think we know where a lot of that is.
“Really what’s lacking is the ability to raise the funds to go and look for it. Funding for exploration in Europe is next to non-existent and yet it has some of the best geology in the world.”
A number of companies in Cornwall have advanced projects aimed at extracting lithium from the region’s granite and clay beds with the aim of meeting demand from manufacturers including Tata Group’s new £4bn battery “giga factory” to be built in Somerset. But despite the release earlier this year of a study by the British Geological Survey pinpointing eight areas of the UK which have the right geology to yield 17 of the 18 metals identified by the Government as critical to economic stability, industry sources say there is a dearth of exploration activity.
Mr Stifano pointed to the existence of tax-deductible exploration investment schemes in Canada as a potential way to kickstart projects in Britain, adding that public funding may be needed to spark wider interest in a sector where China, which recently announced export restrictions on germanium, is taking an increasingly muscular stance.
He said: “In the early days, you may need something like [public funding] because the culture is lacking. In Canada, people talk about discoveries and opportunities and mining. You go to Europe or the UK and it’s not part of the natural culture – people would much rather invest in a Unilever or a Glaxo or any of the big companies.
“China is slowly going to be putting more and more export restrictions on critical metals and it is going to put a lot of pressure on the Western world because we stopped looking for those same metals.”
The mining executive highlighted the fact that it has taken Galantas two years to obtain permission to drill one-inch diametre core samples at its Omagh site – a permitting process that would generally take a month in Canada or Australia – as an example of the logistical and procedural difficulties facing the exploration industry in the UK. Environmental groups have previously raised concerns about the impact of drilling near water sources and aquifers.
Mr Stifano said he recognised the need for any mining company to act sustainably and responsibly but added he believes it is “no longer fair” for Western countries to source their materials from “poor countries with no regulation” and they should instead focus strongly on building homegrown industries.
He said: “What I am trying to push at is the minerals industry needs support in the early stages. If we are going to move to electric vehicles and clean energies we have to find these critical metals, or they are all going to come from China.”
The Government said it was supporting Britain’s critical minerals industry following the unveiling last year of a national strategy to grow domestic capabilities and announcement this week of a £24m investment in Cornish Lithium. In a statement, the Department of Business and Trade said: “Government continues to work with industry and finance communities to support private sector investment in critical mineral projects along the value chain.”
