Morgan D. Bazilian opines that the U.S. is 100 percent import-reliant on 14 minerals and metals that are essential for defense technologies, consumer goods and clean energy technology, and 50 percent or more reliant for another 30, according to the U.S. Geological Survey. These numbers go beyond the recent headlines on rare earths to illustrate fundamental building blocks of the energy transition: lithium, cobalt and nickel for batteries, and materials for solar power and wind turbines. In many of these areas, China has become the dominant world player. The issue is not geological resource constraints, but on whether domestic focus on mining production, processing and manufacturing should be prioritized.
In response to these trends, on May 2, 2019, Senator Lisa Murkowski of Alaska released her American Mineral Security Act into the Senate. This follows other, similar bills over the past few years. In the run-up to this one, she said that, "energy and mineral security are the building blocks of a robust economy." The energy part of that equation is not new to the political realm.
Energy security has, for decades, been high on the agenda of politics and defense, but less so for minerals and metals. In April, Murkowski, along with Senators Joe Manchin and Shelley Moore Capito of West Virginia released a bill in a related genre—the Rare Earth Element Advanced Coal Technologies Act. Much of the framing of both bills is around fighting Chinese dominance.
In May, Chinese state media put out some statements indicating a ramp-up of language around using rare earths supply as a strategic counter to the Trump administration's latest tariffs. The "tools" China has, according to the article, include, "cutting the number of rare-earth mining licenses, raising market access standards for miners, reducing exports of primary rare-earth products, and restricting outbound and inbound investment in related industries." The primary industries mentioned in these Chinese articles are linked to the defense industry, but rare earths are used in many other critical sectors including energy (think oil refining, electric vehicles and wind turbines).
A recent article in Foreign Policy covers some of these issues in the context of an increasingly interconnected world. That essay notes the previous use, in 2010, of limiting rare earth exports to Japan. It is around that time that the price of rare earths spiked and were thrust squarely into the public's attention.
Also imminent is the final report on critical minerals in the U.S. under Executive Order 13817 of 2017. The principal impetus for that order is straightforward: "The United States is heavily reliant on imports of certain mineral commodities that are vital to the Nation's security and economic prosperity. This dependency of the United States on foreign sources creates a strategic vulnerability for both its economy and military to adverse foreign government action, natural disaster, and other events that can disrupt supply of these key minerals." In early June, with little fanfare, the Department of Commerce issued a “A Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals.” It usefully proposes six action areas across the value chain, including areas of trade, workforce education, R&D, trade, and domestic production.
These issues of supply threats, international relations, security and the related analysis is has been intensely analyzed and addressed in in energy policy—especially in relation to oil. The 1967 and 1973 oil embargoes had global ramifications, and helped usher in an era of oil security that we largely still occupy. The recent big change in energy security has been due to the shale revolution. The U.S. has become the largest producer of crude in the world, and one of the largest exporters of natural gas, through a combination of technology development and supportive regulations and policy. That trend has not gone unnoticed in the mining sector.
About a year ago, in May 2018, the USGS came forward with a draft list of 35 critical minerals. Many of the minerals are essential for the defense or aerospace sectors, and of course, many for energy. The links to energy are increasing as the energy transition—a move toward a low-carbon, battery and solar energy–intensive energy system—continues apace. It also appears clear that whatever form the energy transition takes, it will be more mineral-intensive than in the past.
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