A Strategic Overview of the Canadian Critical Minerals Strategy
Recently, the Government of Canada released its final version of the Canadian Critical Minerals Strategy. From exploration to recycling, this comprehensive strategy will guide the federal government’s approach to powering the green and digital economy, both for Canada and the rest of the world.
Similarities to the Discussion Paper
The Strategy builds upon the Critical Minerals Discussion Paper that was previously released by the federal government in June this year. Expanding upon the Discussion Paper’s featured priorities, the Strategy enshrines further details regarding how the designated $3.8 billion in funding from Budget 2022 will be allotted in order to capitalize upon the generational opportunities that the industry presents.
Canada’s Critical Minerals Advantage
The federal government has inferred that Canada possesses numerous competitive advantages that will bolster its vision to increase the supply of responsibly sourced critical minerals and support the development of domestic and global value chains. National assets that will further this include Canada’s abundant clean energy resources, an established advanced manufacturing sector, as well as recognized environmental, social, and governance credentials.
The Strategic Objectives
In order to execute the Strategy, the Government of Canada will implement a whole-of-government approach that will be forward-looking, iterative, adaptive, and long-term. Collaboration and updates will be concurrent and ongoing at all levels in order to advance circular solutions and to account for the ever-changing industry considerations and geopolitical climate. Specifically, the six following objectives will be actively pursued:
Driving Research, Innovation, and Exploration
To unlock its potential as a leading critical minerals nation, Canada will expand its geoscience and exploration activities in order to find future deposits and locate the critical minerals in our vast landmass. Federal initiatives to support Canada’s development of innovative technologies and industrial practices that will optimize efficiency, cost competitiveness, and environmental stewardship include:
- $79.2 million for public geoscience and exploration;
- 30% Critical Mineral Exploration Tax Credit for targeted critical minerals;
- $47.7 million for targeted upstream critical mineral R&D through Canada’s research labs; and
- $144.4 million for critical mineral R&D, and the deployment of technologies and materials to support the development for upstream and midstream segments of the value chain
Accelerating Project Development
Following regulatory assessments, the federal government will provide financial and administrative support to accelerate the development of strategic projects in critical mineral mining, processing, manufacturing, and waste reduction. This support will stimulate the industry as most critical mineral industrial projects require large upfront investments that are higher risk and may generate a slower return. Additional federal government initiatives to accelerate project development include:
- $1.5 billion for the Strategic Innovation Fund to support critical minerals projects;
- $40 million to support northern regulatory processes for critical minerals projects; and
- $21.5 million to support the Critical Minerals Centre of Excellence to develop federal policies and programs to assist project developers.
- Further build upon the Mines to Mobility initiative to advance sustainable battery innovation and an industrial ecosystem.
Building Sustainable Infrastructure
Strategic investments into sustainable infrastructure that can navigate Canada’s remote and challenging terrain will be key in order for Canada to achieve its critical mineral potential and secure its position as a leading supplier. Federal initiatives that will support sustainable infrastructure include:
- $1.5 billion for infrastructure development for critical mineral supply chains;
- Investments in green energy and transportation to unlock critical mineral regions and drive emission reductions; and
- Additional support from existing complementary federal programming, such as the CIB.
Advancing Reconciliation with Indigenous Peoples
The federal government’s critical minerals efforts will be based on respect for Aboriginal and treaty rights and meaningful engagement, partnership, and collaboration with First Nations, Inuit, and Metis peoples and governments. It is projected that the development of the industry will present significant opportunities to advance reconciliation and for the Indigenous economy to grow. These considerations will be additionally supported by:
- $103.4 million from Budget 2022 to advance participation in the natural resource sector, including over $25 million to support early engagement in the Critical Minerals Strategy; and
- The development of a National Benefits Sharing Framework to help ensure that Indigenous communities directly benefit from major resource projects in their territories.
Growing a Diverse Workforce and Prosperous Communities
Through developing Canada’s critical minerals industry, jobs and prosperity will be created for communities across the country. To help ensure that there is a diverse and inclusive workforce to support the Canadian critical minerals value chain, the federal government will:
- Offer federal skills and training initiatives to help institutions and employers;
- Assist youth in developing skills and transitioning into the labour market;
- Present partnership opportunities with provinces and territories, Indigenous-led organizations and several stakeholders to create greater awareness and understanding of mineral literacy; and
- Continue collaboration on initiatives under the Canadian Minerals and Metals Plan.
Strengthening Global Leadership and Security
The federal government recognizes the supply chain disruption and price inflation risks that have been ongoing due to limited overseas countries producing critical minerals using non-market-based practices. By becoming a responsible supplier, Canada will mitigate this concentration risk and further responsible, inclusive, and sustainable practices. Federal government initiatives to reinforce supply chain security and stability include:
- $70 million for global partnerships to promote Canadian mining leadership;
- Leverage and improve the Responsible Business Conduct, ESG standards, and international best practices; and
- Launch an initiative and further existing frameworks to drive the global uptake of ‘nature-forward’ mining practices.
What Does Success Look Like?
As the foundation in which modern technology is built and the basis of a green energy transition, the demand for critical minerals will continue to increase. Through implementing the Strategy, the federal government is confident that Canada can seize the opportunities to become a global leader and receive a multitude of benefits from the industry, including but not limited to:
- The creation of high-quality and high-paying jobs;
- Improved Canadian economic resiliency;
- Attracted foreign direct investment;
- Reduced greenhouse gas emissions;
- Respectfully incorporated Indigenous knowledge into industry development;
- Prioritized economic reconciliation through Indigenous participation and respected Aboriginal treaty rights;
- Enhanced diversity and inclusion in the workforce; and
- Strengthened international best practices and cooperation agreements.