Critical Minerals Strategy 2023: discussion paper

Submission to:

Australia’s Critical Minerals Strategy:
Discussion Paper
AMBC Submission to Australia’s Critical Minerals Strategy Discussion Paper

3 February 2023

The Advanced Materials and Battery Council’s submission to the
Australia’s Critical Minerals Strategy Discussion Paper
The Advanced Materials and Battery Council (AMBC) has recently been established to support companies to develop multiple battery chemistry value chains to meet global demand for energy storage in the global transition to net zero emissions. This requires a focus on facilitating the extraction of critical minerals and processing the minerals to the requisite purity for battery precursor materials. This submission provides feedback from the AMBC to Australia’s Critical
Minerals Strategy Discussion Paper.

A. Creating economic opportunity
1. How can Australia capitalise on its existing advantages to create economic
opportunity for all Australians – particularly regional communities and First
Nations Peoples?
Australia’s critical minerals deposits are often located near regional communities, and in
more remote locations near First Nations’ communities. Mining and processing should be
encouraged to be conducted in situ, so that employment opportunities are made available
to those communities closest to the deposits. Infrastructure investments can be targeted to
make smaller towns and regional centres more attractive for ‘near mine’ processing,
creating the majority of processing jobs close to existing communities. This would help
create Local Investment Local Opportunities (LILO) projects rather than Fly in Fly Out (FIFO)
operations. Furthermore, royalty relief based on local employment of unskilled, skilled and
upskilled persons could be used as a mechanism for encouraging employment within the
region.

Establishing operations in regional, rural or remote areas however brings challenges.
Resolution of these challenges needs to be articulated in a clear and transparent way.
Communities and Traditional Owners must be consulted from an early stage of the project
life cycle to ensure they not only have a say in the developments in their region but are
taken along for the journey. Consultation needs to include clearly articulated benefits of
development and assistance from local service providers to demonstrate good faith by
prioritising local services and attention to assisting with high quality employment
opportunities. On-going community engagement is vital to the success of any project and
this includes support for training and development for workers and creating business
opportunities for First Nations people.

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AMBC Submission to Australia’s Critical Minerals Strategy Discussion Paper

2. What could be done to facilitate project development and ensure benefits flow to
regional communities?
The Queensland Government’s announcement to establish the Critical Minerals Processing
Plant in Townsville is evidence that the Queensland Government is serious about assistance
to the sector. However, encouraging investment in critical minerals processing projects
requires more than a common user demonstration facility. There is also an urgent
requirement for investment in road infrastructure to facilitate access to mines for miners
and employees, investment to secure water supply for extraction and processing,
facilitating renewable energy investment for supply to mines and rural communities, and
investment in industrial precincts for industry development.

Mining and agricultural co-investment should be encouraged from the start of mine project
planning, seeking opportunities for common infrastructure to leverage new enterprises in
both sectors. For instance many state government regulations restrict the use of mine water
in agriculture, due to reasonable concerns about effects of brines and highly mineralised
water on the environment. However, this should not be a blanket ban and where mining
projects can provide water at a quality that local agricultural enterprises are prepared to
accept, these regulatory barriers should be removed.

3. What might be done to ensure maximum reasonable opportunity for local
employment and local business participation in projects?
See answer to Q1 above.

4. What role can Government play to help ensure the sector maximises gender
equality?
There is a shortage of adequate skilled resources for extraction and processing of critical
minerals, and an even greater shortage of adequately skilled female resources. Government
can facilitate training and skill development in regional universities and Tafes close to
critical minerals deposits with targets for female enrolment, certification and graduation.
Our members are supportive of gender equality, but there has to be gender equality of
available adequately trained human resources.

B. Developing new sovereign capabilities and industries
5. What are the specific opportunities Australia should seek to realise while
developing downstream processing and manufacturing capabilities?
Assistance for project development as mentioned in the answer to Q1, should be prioritised
to larger deposits so that multi-user equipment can be deployed for crushing, grinding and
processing to support multiple projects and reduce capital outlay for project proponents.
The Federal Government’s Australian critical minerals list currently excludes nickel and
copper which are minerals as important as lithium for the global clean energy transition.
This should be rectified.
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AMBC Submission to Australia’s Critical Minerals Strategy Discussion Paper

Also, downstream processing should extend beyond lithium carbonate & hydroxide to
elemental lithium metal refining and lithium foil production, and for stationary energy
storage, greater attention should be given to Flow Battery chemistries. Flow batteries are
particularly well suited to support Australia’s shift to electricity supplied from renewable
energy. Australia will require up to 90GWh of storage capacity to support the energy
transition, up from 1GWh of storage in the system today. Vanadium Redox Flow Batteries
(VRFB) and Zinc Bromine Flow Batteries (ZBFB) are very well suited to longer duration
energy storage system and grid support because apart from the tanks and control systems,
they do not require more expensive and less plentiful metals like cobalt, nickel and lithium.
The relatively easy manufacturing process for production of electrolyte and flow batteries
will fast-track the development of new sovereign capabilities within a battery industry
ecosystem. Flow batteries are recyclable (for VRFBs, over 90% of the system may be
recycled) and will contribute to the development of Australia’s circular economy.

A further benefit for Vanadium projects is that Vanadium is also most widely used in the
steel alloy industry, has an important role to play in aviation, aerospace, automotive and
defence applications and will feature prominently in the low emissions steel technologies of
the future.

6. For key technologies and value chains, such as batteries, magnets, alloys and
other clean energy technologies, what are the key obstacles to Australia moving
up the value chain?
Key obstacles to moving up the value chain include a lack of ready-for-business industry
precincts, too little access to common equipment for testing and manufacturing, and
insufficient experienced engineering skills and technical know how which can slow down
investment decisions. What is required is support for domestic market opportunities by
focussing on local content. Downstream market signals driven by the governments to use
local content will provide pipeline security to organisations looking to move up the value
chain. Low pricing of overseas supply is currently a hurdle that can be cleared once local
supply chains are developed at competitive scale.

7. How can governments, industry, and researchers support Australia’s critical
minerals industry to move further downstream and develop new sovereign
capabilities?
Critical minerals projects are primarily junior miners without access to networks necessary
to secure adequate support from researchers, governments and investors. Governments
should seek to resource and support organisations (like the AMBC) to secure tighter
integration between governments, industry and researchers.

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AMBC Submission to Australia’s Critical Minerals Strategy Discussion Paper

8. What can Australia do to better develop and retain IP and to attract IP
investment from like-minded partners?
Australia should provide greater tangible support for companies seeking to develop and
commercialise Intellectual Property. Greater support from government will in turn
encourage investment from private sources as well as other governments.

Battery minerals require customised refining and processing stages traditionally developed
and deployed overseas. Expensive and time-consuming pilot work is required to build and
test these processes. Australian governments can help support pilot projects to develop new
techniques. Equally, providing greater R&D incentives for extraction to maximise yield, and
critical minerals process development, are key to developing Australian Intellectual
Property. Another option would be to enhance the applicability of R&D tax offsets and
increase the % of return for novel processes developed in Australia.

The cost of preparing, lodging and securing patents should be eligible under the R&D Tax
Rebate arrangements after the grant of the patent at least in Australia, and subsequently
the costs of extending registration overseas should also be eligible. It is somewhat perverse
that the costs of eligible R&D can be claimed but not the costs of protecting the resulting
Intellectual Property.

C. Building reliable, competitive and diverse supply chains
9. How can government support the capability of critical minerals companies and
other relevant entities to identify, engage and grow new target markets?
The European Commission, the United States Government, Japan and Korea have all
indicated a wish to diversify energy storage supply chains. Preferential trade agreements
between Australia and these governments for critical mineral ores and their refined value-
added products, will provide greater access to global markets, which will provide significant
support to critical minerals companies. Selling Australia as a refined materials supplier
rather than a just a supplier of raw ores will be instrumental in the development of the
Made in Australia brand.

Visibility to international customers could be achieved through international marketing
campaigns, initiated by government and supported by industry groups, to promote
Australian critical minerals projects globally as a low-risk, high ethical and sustainable value
critical mineral supplier of choice. The production of the Critical Minerals Prospectus is also
an important asset in international outreach by the Government promoting Australian
projects. For smaller explorers/project developers the costs of attending international
trade missions are often prohibitive. A scheme to support qualifying juniors (ie minimum
JORC Measured resource of a critical mineral or similar measure of project viability) to
rebate costs of attending international trade missions would accelerate engagement with
and exposure to international investors and customers.

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AMBC Submission to Australia’s Critical Minerals Strategy Discussion Paper

10. How should Australia engage with international partners to support the
diversification of supply chains? What should this engagement focus on (including
which countries)?
See answer to Q9

11. What actions can Australia take to ensure it leverages related investment
by other countries, for example the US Inflation Reduction Act.
See answer to Q9

12. Is there more the Australian Government can do to facilitate business-to-
business engagement and drive supply chains diversification?
See answer to Q9

13. How can Government and business work together to ensure private sector
insights on the context and complexity of current supply chains and markets can
inform policy design?
The Advanced Materials and Battery Council has been established for exactly this purpose.
However because the sector is small and with limited resources, it is difficult to fund
adequate resources to carry out the activities required to be effective. Industry growth
centres have been supported in Australia for other sectors like energy resources and
advanced manufacturing but there is no equivalent support for the AMBC to facilitate
government and business working together to inform policy design.

Significant support has been provided for the deployment of electricity generation from
renewable sources through ARENA, CEFC and NAIF. Similar levels of support for energy
storage would deliver similar benefits.

Government should also resource and direct its foreign trade agencies and market
intelligence gathering networks to proactively collect market data and map target market
supply chains and supplier concerns, delivering informed and qualified data to Australian
industry group participants, as happens in our trading partners industry and government
alliances.

D. Supporting clean energy technologies
14. What are the opportunities for critical minerals projects to maximise their
ability to support clean energy supply chains and technologies?
There is significant opportunity in Australia to supply energy storage for firming of
electricity from renewable energy sources. As an example the Queensland Government’s
Energy and Jobs Plan has allocated $500 million investment in energy storage, this could be
supplied from batteries produced from all local content.

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AMBC Submission to Australia’s Critical Minerals Strategy Discussion Paper

15. How could the Australian Government help industry address capability
barriers to supporting clean energy supply chains for critical minerals projects?
The Australian Government should increase funding to Australian universities to facilitate
support for commercialisation and the development of education programs to increase skills
and knowledge customised to the sector’s needs.

16. How can the Australian Government support the sector’s integration with
key clean energy supply chains, both domestic and international?
Domestic integration can be supported by governments’ energy contracts including local
content targets for identified critical mineral products. Support for Australian producers to
lead the world with digital transparency for sustainability and compliance for mining and
manufacturing activities will assist with integration in international supply chains including
particularly a focus on verified emissions intensity of product at the point of export. Even
where emissions intensity of certain minerals or secondary processed material is relatively
high, the value of having the data at all will, for a period, immediately preference
Australian product to those supply chains where emissions reporting and border tax
adjustments are expected to be in place in this decade.

E. Supporting sustainable critical minerals development
17. What more can Australia do to ensure we are the international best
practise jurisdiction for ESG?
Australia can secure an international reputation for international best practise by
continu\ing to invest in research and teaching to ensure that extraction and metallurgy lead
international best practise. Also, engaging in ESG programs such as Social Suite will assist
organisations to report and monitor ESG and Everledger can follow through to prove
provenance of products, to ensure compliance with world’s best practise.

Ongoing investment in Geoscience Australia can facilitate the network of State Geological
Survey offices applying new methods and tools to pre-competitive field work, resources
assessment and mapping. Mapping and analysis of the extensive mine dump and mineral
process waste dumps seeking ‘re-mining’ opportunities should be a priority. While re-mining
will very rarely be of the scale of a new major deposit brought to production, in aggregate
critical minerals that were discarded into the dumps of 19th and 20th century mining
precincts are likely to be meaningful in terms of total Australian reserves of those minerals –
for instance Cobalt in nickel mine dumps.

18. What role can Government play in supporting the critical minerals sector
ensure workplaces are safe and inclusive, and can attract and retain
underrepresented cohorts, such as women?
See answer to Q4

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AMBC Submission to Australia’s Critical Minerals Strategy Discussion Paper

19. How can Government and industry create meaningful engagement with
First Nations Peoples and ensure critical minerals projects benefit their
communities?
Starting points for ensuring engagement could involve a simple test that project developers
have an effective policy of engagement with the relevant Registered Native Title
Corporation (RNTC) where one exists with native title to the project area. Engagement with
the RNTC should have the intention of assessing the capacity of members and beneficiaries
of the RNTC to participate with the project in any position the project is seeking to fill. In
most instances where RNTC’s do exist there will have already been engagement between
the parties to conduct heritage clearances of areas likely to impacted during exploration
and in mine development and operation. One common area of engagement is to ensure that
project developers have at the very least an active indigenous cultural heritage
interpretation program for all employees on the project site so that the workforce
understands the cultural context of the landscape and the indigenous landholders’ practices
for caring for country. Opportunities for RNTC members or beneficiaries to work around
mining projects is enhanced when a common understanding of the indigenous appreciation
of the landscape is widespread in the workforce. As a minimum Government, industry and
stakeholders should be creating Reconciliation Action Plans (RAP), in consultation with First
Nations Economic Participation organisations.

20. What are the opportunities to further strengthen the ESG credentials of
the sector? For example, helping industry showcase their high ESG projects or
support enabling capabilities such as the adoption of mineral traceability
measures.
Companies' awareness and engagement with climate and environmental issues is increasing
rapidly. S&P cite 80 percent of the world’s largest companies are reporting exposure to
physical or market transition risks associated with climate change, and a similar share are
engaging in reducing corporate emissions.

The importance of verifiable and trusted ESG credentials and claims has also come under
scrutiny at the World Economic Forum meeting at Davos where some companies have made
false claims, or the tools they were using (Carbon Credits) were proved to be ineffective.

Given Australia’s high standards of governance and environmental standing there is an
opportunity for the sector to show strengthened and verified credentials where possible.
Tools such as blockchain or distributed ledger technology can complement attested-to
claims with shared evidence and proof that battery minerals value chain participants meet
high Australian standards. The same opportunity exists for mineral traceability in following
batches of materials as they move through a supply chain. The importance of this has been
made clear by the emerging jurisdictional requirements of the European Union (Carbon
Border Adjustment Mechanism, Battery Passport), and USA (Inflation Reduction Act).

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AMBC Submission to Australia’s Critical Minerals Strategy Discussion Paper

21. What are the opportunities for Australia in increasing recycling and
circular economy practices in the critical minerals sector?
Growing Australia’s circular economy needs to start with the following policy principles for
advanced materials and batteries:
• back design and manufacture that addresses the full life-cycle of the battery including
easy removal of minerals during recycling and opportunities for second-life or
repurposing of batteries;
• encourage reporting of materials and possible negative impacts from the recycling
process, in particular the potential for chemical reactions resulting in fire and safety
concerns;
• ensure product provenance through independent assessment stewardship schemes.

Australia’s advantage from domestic critical minerals deposits can be expanded to include
the extraction of minerals from existing batteries or from mine tailings, which if processed
close to site in combination with virgin minerals, will save time, money and energy. In
addition, there are broad scale opportunities for Australia to reconsider how its minerals are
“sold” - and instead leased, in order to control the tenure of finite minerals and rare earths.
e.g. If sold to a car company, a valuable and rare asset will remain the property of the car
company in perpetuity - rather than leased to the car company for ten years and re
processed in Australia.

Conclusion
The AMBC is very pleased that the Department of Industry is consulting on the development of
Australia’s Critical Minerals Strategy. We thank Minister King for providing us with the opportunity to provide our feedback. If the Department of Industry has any further questions or detail, we are happy to be contacted either through the AMBC website (ambc.au) or to the members listed below.

Lynette Molyneaux: University of Queensland Rob Williamson: Alpha HPA
(l.molyneaux@uq.edu.au) (rwilliamson@alphahpa.com.au)
Thomas Northcott: Vecco Group Michael McCann: Lava Blue
(tnorthcott@veccogroup.com.au) (Michael.Mccann@lavablue.com.au)
Lee Finniear: Li-S Energy Gavin Loyden: QEM Ltd
(l.finniear@lis.energy) (gavin@qldem.com.au)
Craig Nicol: Graphene Manufacturing Group Paul Roberts: Everledger
(craig.nicol@graphenemg.com) (paul@everledger.io)

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