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Pentagon Backs US Funding For Strategic Mining in Australia, UK

Relying only on domestic or Canadian sources, the Department of Defense said, “unnecessarily constrains” the DPA programme’s ability to “ensure a robust industrial base.”


A mine in Western Australia
An aerial shot of the Mt Weld mine in Western Australia operated by Lynas, the country's biggest miner of rare earths. The Pentagon last year awarded a DPA grant worth $30.4 million to Australia-based Lynas Rare Earths to build a processing facility in Texas with privately held Blue Line Corp. Photo: Lynas.

 

The US should fund Australian and British strategic mining of materials used to make electric vehicles and weapons, the Pentagon has urged.

Washington is working to reduce US reliance on China for lithium, rare earths and other minerals used to make a range of technologies.

The request to alter the Cold War-era US Defense Production Act (DPA) to back strategic mining projects came as part of recommendations to Congress on how to write the upcoming US military funding bill. Congress will vote on proposed changes when it finalises the bill later this year.

Existing law bars DPA funds from being used to dig new mines, but they can be used for processing equipment, feasibility studies and upgrades to existing facilities. Currently, only facilities in the US and Canada are eligible for DPA funding.

Adding Australia and the UK would “allow the US government to leverage the resources of its closest allies to enrich US manufacturing and industrial base capabilities and increase the nation’s advantage in an environment of great competition”.

 

ALSO SEE: Rare Earths Miner Lynas Sees Demand Outstripping Output

 

 

‘Unnecessarily Constrains’ DPA Programme

Relying only on domestic or Canadian sources, the Department of Defense said, “unnecessarily constrains” the DPA programme’s ability to “ensure a robust industrial base.”

A Pentagon official was not immediately available for additional comment. The National Mining Association, a trade group for the US mining industry, declined to comment.

Australia has mining and processing facilities for a range of minerals, including iron ore, lithium, copper and rare earths. The latter is a group of 17 metals used to make magnets that turn electricity into motion.

The Pentagon last year awarded a DPA grant worth $30.4 million to Australia-based Lynas Rare Earths to build a processing facility in Texas with privately held Blue Line Corp.

Last month, Lynas chief executive Amanda Lacaze complained that those funds have yet to be disbursed, citing ongoing negotiations over protection of her company’s intellectual property.

The UK refines nickel and has several proposed processing facilities for lithium and rare earths.

 

  • Reuters, with additional editing by George Russell

 

 

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George Russell

George Russell is a freelance writer and editor based in Hong Kong who has lived in Asia since 1996. His work has been published in the Financial Times, The Wall Street Journal, Bloomberg, New York Post, Variety, Forbes and the South China Morning Post.

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