- The move is part of a wider US$8.5bn critical minerals agreement between the US and Australia to reduce dependency on China
The Export-Import Bank of the United States (US Exim) has signed seven letters of interest (LOIs) totalling more than US$2.2bn to advance critical minerals projects in Australia, as part of a broader deal signed between the two countries this week.
The LOIs were issued to Arafura Rare Earths, Northern Minerals, Graphinex, La Trobe Magnesium, VHM, RZ Resources and Sunrise Energy Metals.
The supported projects span a range of critical minerals, including rare earth elements, graphite, magnesium, titanium and scandium, all of which are needed for defence systems, aerospace components, communications equipment and next-gen industrial technologies.
The letters were signed by new US Exim chairman John Jovanovic and Australian Minister for Resources Madeleine King at the US export credit agency’s headquarters in Washington, DC, on October 20 (pictured).
They are part of a US$8.5bn critical minerals framework deal inked by US President Donald Trump and Australian Prime Minister Anthony Albanese on October 21.
US Exim’s commitments are set to advance Trump’s wider critical minerals agenda, which aims to shrink the US’ dependence on China’s rare earth metals and boost the resilience of its defence and technology supply chains.
“Under President Trump’s leadership to strengthen US national security and economic resilience, Exim is proud to issue more than US$2.2bn in letters of interest advancing critical minerals and supply chain security projects between the United States and Australia,” said Jovanovic.
“Each of these projects reflects our commitment to enhancing supply chain resilience, revitalising domestic manufacturing, and creating high-quality US jobs.”
Six of the seven projects are being carried out in partnership with Export Finance Australia (EFA), under the US Exim-EFA ‘single point of entry’ framework – which was originally announced on 25 October 2023 by former President Joe Biden and PM Albanese, and kickstarted later in 2024.
The newly inked US-Australia agreement includes commitments from both countries to each provide at least US$1bn in financing to critical minerals projects in the US and Australia over the next six months.
The two countries will jointly invest a total of at least US$3bn in projects requiring US$8.5bn of capital expenditure.
Australia’s Chamber of Minerals and Energy WA welcomed the “game-changing” deal, adding it helped position Australia “as a critical minerals supplier of choice to the world’s biggest economy”.
A recent McKinsey study found that nearly US$5tn in capital expenditure could be needed to address a looming shortfall in metals supply, as demand for commodities such as copper, nickel and lithium is expected to vastly surpass supply in the next decade.
