The Pentagon Requests Funding For Mining Ventures in Australia And The U.K.

The U.S. Department of Defense has requested funding for facilities in the United Kingdom and Australia that process key minerals used in the production of electric vehicles and weapons, deeming the proposal vital to national security.

The request to amend the Cold War-era Defense Production Act (DPA) was part of the Pentagon's recommendations to Congress on how to draft the next National Defense Authorization Act, a military financing law.

When it finalizes the bill later this year, Congress may approve or reject the suggested amendments.

Washington is making more efforts to lessen the United States' reliance on China for lithium, rare earths, and other minerals required in the production of a variety of technology. Existing legislation prohibits the use of DPA money to excavate new mines, but they can be used for processing equipment, feasibility studies, and facility renovations. Currently, only American and Canadian facilities are eligible for DPA funding.

The Pentagon stated in its request to Congress that adding Australia and the United Kingdom would "allow the U.S. government to leverage the resources of its closest allies to enrich U.S. manufacturing and industrial base capabilities and increase the nation's competitive advantage in a highly competitive environment."

The Pentagon stated that relying solely on domestic or Canadian sources "unnecessarily restricts" the DPA program's capacity to "ensure a robust industrial basis."

A Pentagon official was unavailable for further comment at this time.

The U.S. mining industry's trade association, the National Mining Association, declined to comment.

RARE SOILS

The United Kingdom refines nickel and has many proposed lithium and rare earths processing facilities. Australia has mining and processing facilities for a variety of minerals, including iron ore, lithium, copper, and rare earths, a group of 17 metals used to create magnets that convert electrical energy into mechanical motion.

Lynas Rare Earths Ltd., based in Australia, was awarded a DPA grant of $30,4 million by the Pentagon in order to construct a processing facility in Texas in partnership with Blue Line Corp.

Amanda Lacaze, chief executive officer of Lynas, protested last month that the cash had not yet been distributed, citing continuing negotiations regarding the security of her company's intellectual property.

The Pentagon has also provided at least $45 million to MP Materials Corp, which owns the only rare earths mine in the United States but relies on China for processing.

The monies will support MP's attempts to resume processing of these important minerals in the United States. MP, based in Las Vegas, announced last week that it has begun receiving these monies and that the Pentagon will have "some rights to technical data" as a result.