Canada to set aside $1.6 billion for critical minerals supply strategy

Canada’s latest federal budget will include an investment of at least US$1.6 billion for a strategy to accelerate the production and processing of critical minerals required for the electric vehicle (EV) battery supply chain, according to two senior government sources.

Prime Minister Justin Trudeau will reveal the funding in the budget announcement on Thursday, with the investment poised to benefit miners and mineral processors focused on nickel, lithium, cobalt and magnesium.

There are ‘many active conversations’ progressing between the Canadian government and companies ‘on the need to accelerate and scale up the production of raw materials used in EV batteries’, one of the sources said.

Demand for battery minerals could increase by almost 500% by 2050, according to World Bank estimates. China continues to dominate global production and processing of critical minerals, rare earths and rare metals used to make EVs.

Canada’s critical mineral strategy will focus on, among other things, driving research, innovation and exploration. One innovation being explored across the country is the extraction of critical minerals from tailings dams.

“We’re looking at brines and oil sands, tailings ponds, and all of those things,” said Canada’s Natural Resources Minister Jonathan Wilkinson in a recent telephone interview with Reuters.