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American Resources Policy Network
Promoting the development of American mineral resources.
  • Critical Mineral Uranium: No Import Quotas, But “Significant Concerns” Prompt Fuller Analysis of Nuclear Fuel Supply Chain

    Primarily known for its energy applications, (and thus falling under the purview of the Department of Energy) uranium may have not been much of a focal point for ARPN in the past.  

    However, the policy issues surrounding uranium – many of which have a familiar ring to followers of ARPN – increasingly warrant a closer look.  Last year, the Department of Interior included uranium in its list of 35 metals and minerals deemed critical from a U.S. national security and economic perspective – for good reason.

    As Congressmen Paul Gosar (R-Ariz.), Rob Bishop (R -Utah, Mark Meadows, R-N.C.) outlined in an op-ed for Fox News earlier this month, “U.S. utilities rely on foreign sources for 98 percent of the uranium they use to fuel the nuclear power plants that provide 20 percent of our country’s electricity” – a fact that not only poses a significant national security risk, but harms domestic industry.

    They argued: 

    “Uranium [fuels] our nuclear Navy. But instead of buying from the domestic uranium mining companies that once thrived in the West, utilities are enriching adversarial countries like Russia and China.

    Following their carefully orchestrated geopolitical plan, Russia and its allies flood the global market with uranium from state-owned companies, making it impossible for America and other free-market economies to compete.

    Meanwhile, quietly and gradually, China has been buying up previously free-market uranium mines to control global supply.

    Rather than keep good jobs here at home and depend on our own resources to power the electric grid, the U.S. jeopardizes national security by relying on nations that have demonstrated their will to undermine our defense infrastructure and our economy, and to do us harm.

    As a result, America’s uranium mining industry is dying. U.S. uranium mining companies produced 721,000 pounds of uranium last year – only enough to fuel one nuclear reactor.”

    The Congressmen, writing on behalf of the bipartisan Western Congressional Caucus, called on U.S. President Trump heed a recommendation to impose an import “quota that reserves a relatively small 25 percent of the U.S. market for the domestic uranium mining industry.”

    The recommendation was initially put forth by two domestic uranium mining companies that in January 2018 had requested a Commerce Department investigation under Section 232 of the Trade Expansion Act, with a presidential decision on the findings of the DoC investigation expected by July 15 of this year. 

    Taking many by surprise, however, while agreeing with the Commerce Department that the United States’ reliance on foreign uranium “raise significant concerns,” President Trump last week announced that he will not impose quotas on uranium imports. This comes a  somewhat unusual move for a President who has invoked national security concerns when calling for restricting foreign metal imports elsewhere.

    The President instead announced the formation of a “U.S. Nuclear Fuel Working Group” to conduct a “fuller analysis of national security considerations with respect to the entire nuclear fuel supply chain.”

    In his memorandum announcing his decision on July 12, the President states:

    “I agree with the Secretary that the United States uranium industry faces significant challenges in producing uranium domestically and that this is an issue of national security.  The United States requires domestically produced uranium to satisfy Department of Defense (DOD) requirements for maintaining effective military capabilities — including nuclear fuel for the United States Navy’s fleet of nuclear-powered aircraft carriers and nuclear-powered submarines, source material for nuclear weapons, and other functions.  Domestic mining, milling, and conversion of uranium, however, while significant, are only a part of the nuclear supply chain necessary for national security, including DOD needs.”

    Over the next 90 days, the The Working Group “shall examine the current state of domestic nuclear fuel production to reinvigorate the entire nuclear fuel supply chain, consistent with United States national security and nonproliferation goals.”

    We’ll be keeping tabs on the Working Group’s findings, so check back for updates.  
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  • Moving Beyond the Report Stage? – Specter of REE Supply Disruptions Prompts Congressional Action on Critical Minerals

    The U.S. and China have resumed trade talks after last month’s meeting between U.S. President Trump and Chinese President Xi Jinping on the sidelines of the G-20 summit in Osaka broke a deadlock — but key issues remain far from settled.

    Against the backdrop of both sides preparing for a protracted battle, Jeff Green, president of Washington, D.C.-based government relations firm J.A. Green & Company and member of the ARPN panel of issue experts, zeroes in on the potential ramifications of a looming REE supply cutoff on the U.S. defense industry and appropriate responses in a new piece for Defense News.

    Green laments that supply chain experts for years warned about the “potential for China to cut off access to the critical materials in almost every major weapon system”– but their concerns were often “downplayed by free-trade theorists and policy makers who claimed that China would not take such aggressive action to upset the market.” Green argues that recent statements made by China’s state economic planner, the National Development and Reform Commission, or NDRC, suggest otherwise, and says that “the Chinese strategy is based on a harsh calculus:”

    “Depriving only defense contractors of rare earth supplies will drive costs and production lead times up for the U.S. military and cause concern within the U.S. government, but it will not lead to widespread public discontent. Any student of Clausewitz can see the targeting of a particular center of gravity in the U.S. with this move. The strategy threatens U.S. military supplies rather than cheap consumer goods in what may be an attempt by China to force U.S. policymakers to abandon efforts to counter abusive Chinese trade practices in favor of addressing greater national security concerns.”

    Thankfully, Green says, the U.S. is taking steps to secure supplies of rare earths and other critical materials. He specifically highlights the long-awaited Critical Minerals Strategy put forth by the Commerce Department in early June which  “begins operationalizing the identification and mitigation of supply chain gaps” and a passage in the FY 2019 National Defense Authorization Act which limits “the ability of defense contractors to use rare earth magnets from China (and other non-allied countries).”  

    This, coupled with DoD beginning to query American contractors about their “ability to begin rebuilding pieces of the supply chain, including rare earth separation and magnet production” are “prudent and necessary,” says Green, who concludes:

    “[T]here is more to be done, particularly in Congress, to defend against hostile foreign actions. Mine-permitting reform would help get U.S. supplies of critical minerals flowing again, and Alaska’s Republican Sen. Lisa Murkowski’s American Mineral Security Act and Nevada’s Republican Rep. Mark Amodei’s mine-permitting reform bill both provide strong momentum forward on that effort.

    Pentagon programs such as the Defense Production Act Title III — which was responsible for the inquiries into rare earth separation and magnet production — and the Industrial Base Analysis and Sustainment are both good avenues through which the government can directly invest in promising American manufacturers. Congress now must provide them with adequate funding (…).

    The U.S. needs to seriously address its critical materials vulnerabilities, which it has begun to do with recent reports. But reports can only show the way forward; it is now time for Congress to enact prudent policies and to provide the resources to finally blunt the rare earth and critical materials trade weapon once and for all.”

    It appears, though, as if policy makers are finally realizing the urgency of the situation.  Today’s Wall Street Journal features a new bill by Sen. Marco Rubio (R., Fla.) which would “allow investors to form a cooperative that is exempt from antitrust laws, in an attempt to shield it from government-backed competition from China and volatile markets that have made it virtually nonexistent in the U.S. The Secretary of Commerce would secure a charter for the business, though it would need to be privately funded and operated under the terms of the legislation.”

    In a statement, Rubio explained that:

    “[c]ontinued U.S. dependence on China for the mining and processing of rare earths and the manufacture of those metals into useful products is untenable,” because “[i]t threatens our national security, limits our economic productivity, and robs working-class Americans of future opportunities for dignified work.”

    The cooperative would be “a monopoly open to investment from the Defense Department, the military’s private suppliers and technology companies, among others,” with international investors allowed to join contingent on approval from the Committee on Foreign Investment in the U.S., known as Cfius, reports the Wall Street Journal — a contingency that is likely owed to the much-criticized fact that the only current U.S. REE producer has a Chinese minority stakeholder.

    With the stakes so high, it is good to see that policy makers appear willing to move beyond the report stage.

    We’ll be keeping tabs on critical minerals legislation, including Sen. Rubio’s REE legislation and others as they move forward, so check back for updates. 
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  • Mamula and Bridges: Hardrock “Modernization” Bills Could Do More Harm Than Good

    “Does America stand for self-reliance and innovative discovery of critical minerals for our economy and national defense and security? Or will Congress drive the fatal stake through the heart of our struggling domestic metals mining industry?” According to a new Washington Examiner piece by Cato Institute Adjunct Scholar in Geosciences and ARPN expert panel member [...]
  • Happy 4th of July! The Road to Resource Independence

    Another trip around the sun, and once again we find ourselves stocking up for barbecues, fireworks and parades in honor of the men and women who have fought on our behalf, and continue our safeguard our freedom today. We’ve always used the occasion of Independence Day to remind ourselves that “while we cherish the freedom we [...]
  • Measuring Criticality in Today’s Interconnected World

    Against the backdrop of the current U.S.-Chinese tensions over Rare Earth Elements and the “global battery arms race,” Morgan D. Bazilian, Professor of Public Policy and Executive Director of the Payne Institute at the Colorado School of Mines, argues that the United States must “widen its consideration of critical materials past a limited understanding of security in [...]
  • U.S. to Cooperate with Canada and Australia To Encourage Responsible Resource Development for New Energy Technology

    Amidst growing concerns over the availability of metals and minerals underpinning the EV revolution, the United States, Canada and Australia have joined forces to encourage the responsible development of said materials. As the Financial Times reported earlier last week, the US state department and its Canadian and Australian counterparts “will work to help countries discover and [...]
  • Global Times: REE Supply Restrictions Likely for U.S. Military Equipment Firms

    The specter of China playing the “rare earths card” is looming larger this week.   According to the Global Times’s twitter feed, U.S. military equipment firms will likely face restrictions of Chinese Rare Earth supplies in the near future, as China’s economic planners will “study and roll out policies on rare earths as soon as possible.”     [...]
  • Resource Alert:  North of 60 Mining News Has Launched “Critical Minerals Alaska” Magazine and Dedicated Webpage

    Over the past few weeks, China’s threat to play the “rare earths card” has generated quite a buzz and, along with growing concerns over supply chains for battery tech, has directed much-needed attention to our nation’s over-reliance on foreign mineral resources.  As followers of ARPN know, many of these issues are in fact home-grown, as the United [...]
  • Tesla May Get Into Mining Business, Says Elon Musk, A Visionary Rooted in the Reality of Resources

    If you looked up the definition of “visionary entrepreneur” in the dictionary, chances are you’d stumble over Elon Musk’s name.  Perhaps like no other CEO today, Tesla’s innovator-in-chief has had his finger on the pulse of time, and has arguably “revolutionized many industries.” And while he continues his “mission is to help save Earth for humanity through sustainable [...]
  • CBS’s 60 Minutes Airs Updated Rare Earths Segment Featuring ARPN’s McGroarty

    Bearing testimony to the significance of the looming specter of China playing the “rare earths card,” CBS’s 60 Minutes this weekend aired an update to its 2015 segment on rare earths featuring ARPN principal Dan McGroarty.  You can watch the segment on the CBS website, which also features a written transcript. There is hope that the [...]

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