Ottawa funds critical mineral innovators as part of $3.8B strategy

FUNDING | Six firms awarded a total of $14M

BY COLIN MCCLELLAND

Ottawa awarded six critical minerals companies a total of $14 million on Mar. 7 to help them develop technologies to mine or process metals bound for electric vehicles.

East Coast rare earths explorer Search Minerals (TSX.V: SMY; OTC: SHCMF) gets $5 million; about $3.5 million is for Alberta-focused E3 Lithium (TSXV: ETL; OTC: EEMMF), which got $27 million from federal innovation funding last year; and $3 million goes to rare earths recycler Geomega Resources (TSXV: GMA).

About $1.1 million is for Regina-based Prairie Lithium, a unit of Arizona Lithium (ASX: AZL; US-OTC: AZLAF), while $795,524 is for nickel and cobalt producer Sherritt International (TSX: S), and $724,871 goes to FPX Nickel (TSXV: FPX; OTC: FPOCF).

“Canadian innovators are leading the way toward a cleaner future,” Jonathan Wilkinson, Minister of Natural Resources, said in announcing the funding at PDAC in Toronto. “This means good jobs for workers, more investment in Canadian innovation and lower emissions across the country.”

The funding is part of the government’s nearly $3.8 billion critical minerals strategy by 2030 that was announced almost a year ago in the federal budget. The aim is to speed up mining the 31 minerals declared critical for their roles in economic security to challenge China’s dominance of the metals and for cutting carbon emissions to fight climate change.

The critical list includes copper for wiring, nickel, cobalt, graphite and lithium for batteries, silver for solar panels and rare earth elements used in everything from defence systems to cell phones and wind turbines.

The $14-million funding as part of the Critical Minerals Research, Development and Demonstration Program is the first instalment of some $200 million targeting innovation, Natural Resources Canada said.

Wilkinson also repeated plans for $344 million in six programs loosely centred around research and technology that had been declared in December.

The largest chunk is $144.4 million for developing and spreading new technologies to use in mining

‘Mission from God’

know, when there’s a problem, go to the government, they’ll solve it for you. Of course, there’s going to be a freakout fighting over this money.”

However, Friedland said he’s open to getting some of that funding to join the US$900 million invested in Toulouse, Francebased I-Pulse that includes money from the Bill Gates- and Jeff Bezosbacked Breakthrough Energy Ventures. Friedland is chairman of I-Pulse, which uses high-energy bursts to shatter rocks and mineral ores with a fraction of the energy cost and greenhouse gas emissions in conventional mining.

The company signed a deal in December with BHP (NYSE: BHP; LSE: BHP; ASX: BHP) to further develop the technology that I-Pulse subsidiary Ivanhoe Electric (TSX: IE) may soon market, Friedland said.

“We’re sort of like on a mission from God like in The Blues Brothers to completely change the way we’ve operated in mining for about maybe 1,000 years,” Friedland said.

“We’re pulling rock apart with electromagnetic pulses.”

Similar pulses can be used to explore for deposits underground like the so-called X-ray glasses advertised to boys in the back of comic books to see through clothes, he said.

“We have a magic pair of glasses that allows us to directly see deep mineralization in the earth with very high resolution,” he said. “It’s all based on signal-to-noise ratio in the geophysics and machine learning for the software.”

Friedland’s breakthrough in lithium batteries comes via Ivanhoe startup Pure Lithium in Boston and the help of Donald Sadoway, an emeritus professor at the Massachusetts Institute of Technology.

“This is a battery with lithium and processing critical minerals all the way to finished products like electric vehicle batteries.

It also contains $40 million to help regulations in Canada’s North, $79.2 million for developing geoscience data methods such as digital mapping of deposits and $70 million for Canada to fund international collaboration in the critical minerals scramble.

Last year, Canada joined the new Sustainable Critical Minerals Alliance, which grouped the United States, the United Kingdom, Australia, France, Germany and Japan together to help each other on mining projects.

Funding for a Critical Minerals Centre of Excellence, to help implement the strategy, appeared to be cut in about half to $10.6 million compared with $21.5 million in December.

“Canada will remain at the forefront of the economy of tomorrow by continuing to develop our critical minerals and metals,” FrançoisPhilippe Champagne, Minister of Innovation, Science and Industry, said in a news release. “We will leverage our competitive advantages in clean energy, talent, sustainable mining, and innovation.” TNM metal which is very disruptive and frees you from the requirement to use nickel and cobalt,” Friedland said. “It’s a very high-quality battery.”

The financier criticized measuring mining projects with calculations of net present value, saying they’re more applicable to oil and gas projects instead of mining, where US$690 billion in new copper mines are needed over 30 years, according to consultant Wood Mackenzie.

China doesn’t use net present value but is a chief investor in companies such as Ivanhoe Mines, copper producer First Quantum Minerals (TSX: FM) and giant Rio Tinto (NYSE: RIO; LSE: RIO; ASX: RIO), he said.

“It’s really hard to raise money for mining because the bankers assign a discount rate of eight, 10 or 12%,” he said. “The Chinese, they just said ‘we’ve got 1.3 billion people to feed, we’re going to need this copper.’” TNM