The United States Pentagon has announced a $US400 million ($560 million) investment in a mining project in central western New South Wales, Australia. The project, operated by Sunrise Energy Metals, aims to produce scandium, a critical mineral used in the production of fighter jets, spacecraft, and other defense applications.
The investment is intended to expand production at the Syerston Scandium Project, located near Fifield, south-west of Dubbo. The project is considered a “world-first” as it will be the first primary scandium mine. The US has not mined scandium since 1969, and nearly all global scandium production currently comes from China, Russia, and Ukraine.
The loan from the Pentagon’s Office of Strategic Capital is conditional and will be used to build a complete value chain from mine to finished metal, securing a vital supply of scandium for the US defense and commercial industrial base. US Commerce Secretary Howard Lutnick stated, “We’re going to make sure the United States – not our adversaries – controls the supply chains of power and critical minerals.”
The investment is part of a broader effort by the US to diversify its supply chain for rare earths and critical minerals. Last year, the US and Australia signed a critical minerals deal, which included a commitment to provide at least $US1 billion for critical minerals projects in each country.
Australian Resources Minister Madeleine King welcomed the investment, stating that it was a significant vote of confidence in Australia’s critical minerals sector. King noted that scandium has a range of aerospace, defense, and clean energy applications, and that no one country alone can create secure end-to-end supply chains in critical minerals and rare earths.
The Syerston project has also received support from the NSW government, which has allowed the company to defer royalty payments for five years. The project is considered a strategic importance under the US-Australia critical minerals partnership.
Another company, Scandium International Mining Corp, is also developing a scandium mine near Nyngan, NSW, and a nearby scandium exploration site. The NSW government has stated that the state has the highest concentration of scandium in the world, making it an attractive location for mining companies.
The investment is seen as a significant development in the critical minerals sector, with the US seeking to reduce its reliance on foreign suppliers and secure a stable supply of critical minerals for its defense and commercial industries.
Article and image source: smh.com.au
