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Pentagon Asks Congress to Fund Mining Projects in Australia, U.K

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The US Department of Defense has asked Congress to allow it to fund facilities in the UK and Australia that process strategic minerals used in the production of electric vehicles and weapons, describing the proposal as “critical to national defence.”

The Pentagon’s recommendation to Congress on how to write the upcoming US military funding bill, known as the National Defense Authorization Act, included a request to change the Cold War-era Defense Production Act (DPA).

When the bill is finalised later this year, Congress may reject or accept the proposed changes.

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The United States is working harder to reduce its reliance on China for lithium, rare earths, and other minerals used in a variety of technologies. DPA funds cannot be used to dig new mines due to current legislation, but they can be used for processing equipment, feasibility studies, and upgrades to existing facilities. DPA funding is currently only available to facilities in the United States and Canada.

According to the Pentagon’s request to Congress, adding Australia and the United Kingdom would “allow the United States government to leverage the resources of its closest allies to enrich US manufacturing and industrial base capabilities and increase the nation’s advantage in an environment of global competition.”

The Pentagon claims that relying solely on domestic or Canadian sources “unnecessarily limits” the DPA program’s ability to “ensure a robust industrial base.”

Additional information from a Pentagon official was not immediately available.

The National Mining Association, a trade association for the mining industry in the United States, declined to comment.

The United Kingdom refines nickel and has several proposed lithium and rare earth processing facilities. Iron ore, lithium, copper, and rare earths, a group of 17 metals used to make magnets that turn electricity into motion, are among the minerals mined and processed in Australia.

Last year, the Pentagon awarded Lynas Rare Earths Ltd of Australia a $30.4 million DPA grant to build a processing facility in Texas with privately held Blue Line Corp.

Lynas CEO Amanda Lacaze complained last month that the funds had yet to be distributed, citing ongoing negotiations over the company’s intellectual property protection.

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

The funds will aid MP’s efforts to reintroduce strategic mineral processing in the United States. Because of the financial support, MP, based in Las Vegas, said last week that it has begun receiving those funds and that the Pentagon will have “certain rights to technical data.”

(Ernie Scheyder contributed reporting; Trevor Hunnicutt contributed additional reporting; David Gregorio edited the piece.)

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