Australia's resource sector could be at the cusp of a new boom, the mining of critical minerals, and to create further momentum the government is prioritising critical minerals in the next round of Cooperative Research Centres Projects grants.
Critical minerals used in applications such as mobile phone chips or electric car batteries could potentially open up a new frontier of resource wealth for Australia, according to the official communique of a COAG Energy Council meeting in December last year.
Its major focus was on recommendations from the Resources 2030 Taskforce, whose report was released in September 2018.
Minerals critical to some economies may not be critical to others.
According to Geoscience Australia, minerals highly critical to major world economies include:
Chaired by Andrew Cripps, the taskforce identified critical minerals as a major area of opportunity for the Australian resource sector:
"The United States government has drawn up a list of 35 critical minerals—Australia is the top producer of three of them, with identified reserves of 14 others," it says in the report.
The taskforce recommends to develop strategic plans that target critical minerals, such as rare earth elements, but singles out lithium.
The soft metal is a rapidly growing market, with lithium having tripled in price since 2010 on the back of the battery boom.
In 2017, Australia overtook China as the mineral's largest producer, but the report argues that Australia should also focus on adding value to the resource.
"Is there an opportunity to develop new, efficient and clean processing technologies to support upstream electrochemical processing?"
According to a recent quarterly update from chief economist Mark Cully, Australia could supply 80% of the world's hard rock lithium by 2020. Export earnings from spodumene ore, the precursor material to lithium, could potentially increase from $780 million in 2017 to $1.1 billion in 2020.
Cully's report also says that "Australia has strong potential to move to the centre of the global lithium supply chain given its geological advantages, its experience in rolling out mining investment, and the skills of its workforce."
But Australia has also been steadily increasing its production of rare earths oxides, which was second in the world after China in 2017. The country holds the sixth-largest known rare earths reserves in the world, according to Geoscience Australia.
On the back of the Resources 2030 Taskforce's recommendations, the government is now moving to accelerate the growth of the emerging sector. This includes to direct up to $20 million towards critical minerals projects in the seventh round of CRC-Projects grants (applications close 28 March 2019), with successful applications each receiving up to $3 million, whilst the government is also developing a national critical minerals strategy.
"Prioritising applications for critical minerals is crucial", Minister for Industry, Science and Technology Karen Andrews said in a statement.