U.S. offers cash to Canadian critical minerals projects during Biden’s visit

There’s a pot of gold at the end of President Joe Biden’s jaunt to Canada. It’s going to the Canadian mining sector.

The US military will send funding this spring to critical mineral projects in the US and Canada. The aim is to accelerate the development of the critical mineral industry in the continent.

The context is the United States’ bitter rivalry with China.

The U.S. is eager to reduce its dependence on its adversaries for materials needed to power electric vehicles, electronics and many other products, and has set aside hundreds of millions of dollars under a program called the Defense Production Act.

Pentagon have said Canadian companies will be eligible to apply. It has said the money will come as a grant, not a loan.

On Friday, before Biden left Ottawa, he promised to get some.

The White House and the Prime Minister’s Office declare that companies from both countries will be eligible this spring for money from $250 million US funds.

What Canadian company? The leaders did not speak. Canadian officials have provided a list of at least 70 projects in the US that could guarantee US funding.

Biden also said that Canadian semiconductor projects would gain access to other Defense Production Act programs.

“Our country is blessed with incredible natural resources,” Biden told Canada’s parliament during a speech in the House of Commons.

“Canada in particular has many critical minerals that are important to our clean energy future, to the world’s clean energy future.

“And I believe we have a tremendous opportunity to work together so that Canada and the United States can source and provide in North America everything we need for a reliable and resilient supply chain.”

Canada has also pledged billions of dollars to the sector. One participant at a recent Pentagon briefing in Washington said US funding would assure potential private sector investors that certain projects had US military support.

It is unclear what type of jobs the project will create in Canada.

Biden may have caused some cringes in Canadian political circles when he appeared to suggest that value-added transformation projects from this future sector would go to the US.

They made the perfect partnership: Canada would extract the minerals, America would build the stuff.

“You – we don’t have minerals to mine, you can mine them,” he said. “You don’t want to produce, I mean, turn it into a product.”

Cut the red tape, the mining sector said

Another unknown is how fast this sector will grow in Canada, and whether it can rise in time for this country to become a major player in providing raw materials for a large fleet of electric vehicles.

Some business groups have told the Canadian government that it needs to speed up the permit period or risk seeing this window close for Canada.

The British Columbia Mining Association, for example, has proposed a number of measures to alleviate what it calls untenable delays.

“The permitting and authorization process governing mining projects is too complex, untimely and inconsistent with urgent needs,” he said in a recent briefing paper.

The federal government has recognized this problem and has promise to speed up.

“It cannot take 12 to 15 years to open a mine in this country. Not if we want to meet our climate goals,” Environment Minister Jonathan Wilkinson said late last year.