Canada needs to move quickly on production of critical minerals, IEA says
Canada must ramp up production of critical minerals quickly and show global leadership to defend against energy security crises fueled by countries that weaponize fossil fuels, said the head of the International Energy Agency. Rick Bowmer/The Associated Press
Canada must ramp up production of critical minerals quickly and show global leadership to defend against energy security crises fueled by countries that weaponize fossil fuels, said the head of the International Energy Agency.
During a government-organized panel on Wednesday in Ottawa, Fatih Birol warned that the energy shortages currently gripping Europe could be repeated as the world switches to cleaner fuels if Western countries don’t increase the availability of rare earth minerals and find friendlier sources for them develop .
The minerals are central to net-zero energy sources that need to replace conventional, fossil-fuel emitting energy, according to Birol. Just as oil and gas are weaponized by Russia, so could the supply of critical minerals.
“As a world, we should learn from this bitter experience,” said Mr Birol, who was seated next to German Natural Resources Minister Jonathan Wilkinson. But so far, the same concentration of oil and gas supply is taking place in critical minerals, Mr Birol said, with only a small number of countries putting the minerals on the market. Current production and refining of critical minerals is concentrated in a handful of countries, most notably China.
Mr Birol said he would like countries like Canada to be more involved on the international stage because “there is the rule of law, there is transparency and there is also government accountability”.
The sooner that happens, the better, he said.
That’s a daunting demand for Canada, where provincial and state regulators are involved in mining permits that are sometimes cumbersome. Prime Minister Justin Trudeau’s Liberal government has vowed to cut the bureaucracy that hampers the sector. The pledge came last year after intense criticism that Canada risks being left behind in the global scramble to secure critical minerals.
It can take up to 25 years for a mineral mine to come into production – far slower than international competitors like Australia. Speaking to reporters after the panel, Mr Wilkinson said the average duration was around 12 to 15 years, but added that even that was too long.
“If we take 12 to 15 years, we’re going to have a real problem,” he said.
“We need to find ways to move faster” to help meet domestic and international demand for critical minerals, Mr Wilkinson said on Wednesday. However, he did not set a deadline for talks with provinces and territories to revise the regulatory process, and would not say how long he believes is a reasonable timeframe for regulatory review. However, he said it might differ between provinces.
Critical minerals are used in net-zero technologies such as batteries for electric cars and for solar and wind power.
Wyloo Metals Pty Ltd., the Australian resource giant that earlier this year paid more than half a billion dollars for the most promising assets in Ontario’s long-delayed Ring of Fire project, has been vocal about how slow the permitting process is in Canada. Company executives recently met with Canadian politicians to argue for a reduction in bureaucracy.
Prominent Canadian academic and conservative Jack Mintz has also taken a stand on the plethora of government mining regulations, arguing in a December report with colleague Philip Bazel that “Canada’s participation in the energy transition mining market may depend on the form of its regulatory and taxation framework.”
The pair also said that Canada is unlikely to benefit much from the explosion in global demand for critical minerals due to a lack of reserves, writing that most of these minerals for North America’s energy transition come from reserves in South America, Africa and the US would need Caribbean as well as Australia and China.
Citing global data on critical mineral reserves from the US Geological Survey, the authors note that Canada is a small player in lithium, cobalt, copper, graphite and nickel, all of which are used in low-carbon energies such as electricity. vehicle batteries. Reserves are minerals in the ground that have been proven to be economically viable.
Still, Mr. Wilkinson insisted Canada would not miss out on competitive opportunities in critical minerals. Ottawa is working to harmonize, coordinate and streamline the permitting and environmental assessment process to avoid duplication of work, which often occurs when the federal and provincial governments are involved, he said.
“We’re very focused on how you can go faster, in a way that respects the environment and respects indigenous people’s rights.”
The focus on environmentally and socially responsible production is why Mr. Birol said he believes Canada should be a “champion” in this sector.
Beyond mining, Mr. Wilkinson said there are other opportunities for Canada in the critical mineral space, such as the recovery of lithium from brines, which he says is “much easier and quicker to put into practice than opening a brand new mine.” .
After a recent discussion with his Australian counterpart, he said the relationship between allies on critical minerals is more one of collaboration than competition – which could help speed up and improve production.
“There is so much demand. If we want to implement the energy transition, it’s better for us to actually find ways to become partners to accelerate the work we’re both doing,” he said.
This could include each country learning lessons from each other’s regulatory processes and investment vehicles.