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American Resources Policy Network
Promoting the development of American mineral resources.
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  • New Report Zeroes in on Geopolitics of Renewable Energy 

    While the geopolitics of fossil fuels are well established, we at ARPN have long lamented the lack of awareness regarding the geopolitical implications of non-fuel mineral resource supply and demand. For that reason, we were very pleased to see a recently released study co-authored by Meghan L. O’Sullivan of Harvard University’s Kennedy School, Indra Overland of the Norwegian Institute of International Affairs (NUPI), and David Sandalow of the Columbia Center on Global Energy Policy zero in on precisely this aspect of resource policy.  

    The working paper entitled “The Geopolitics of Renewable Energy” examines how a shift to renewable energy sources, which, while reducing dependencies on fossil fuels, will result in new dependencies on non-fuel metals and minerals ARPN followers are by now familiar with, and the “good and bad geopolitical karma” these new dependencies will bring – including new forms of the so-called “resource curse.” 

    Explains O’Sullivan in a piece introducing the working paper for Bloomberg: 

    “Among the most interesting of possible trends we highlight is the idea that a more renewable-heavy future will likely bring with it new forms of the “resource curse” — the phenomenon that political and economic development in many resource-wealthy countries seems stymied when compared to resource-poor ones. In many resource-rich nations, economic growth is actually slower and political institutions are more likely to be repressive and nondemocratic. 

    In the world of fossil fuels, this curse has generally applied to big producers of oil and gas. In a world heavier on renewables, the curse will probably not be so relevant for producers of power; solar, wind and geothermal energy are more likely to be generated and consumed within the borders of a country than to become profitable exports and generators of huge windfall cash flows. Rather, we may see this curse surface in countries rich in the materials required to produce the components that make renewable energy possible.”

     The paper discusses “seven renewable energy scenarios for the coming decades” and examines “seven mechanisms through which renewables could shape geopolitics” – which the authors associate with both opportunities and challenges. The authors also point out significant uncertainties as “[w]ith the current growth of renewable energy, we are instead dealing with the disruption of old markets and the creation of new ones, which are not known yet.” That, coupled with technological uncertainty – after all the renewables sector “involves several entirely separate types of energy sources, and energy generation, transportation and storage,” makes for big question marks that make predictions about our geopolitical future challenging.

    Concludes O’Sullivan in her Bloomberg piece:

    “This question of new dynamics around critical resources is just one of many examined in our new report. But none of the potential dark sides is a reason to halt or slow the momentum toward a more renewable energy future. The benefits will likely outweigh the costs. Yet, policy makers need to start thinking seriously and objectively about the geopolitical contours of a future more reliant on renewable energy, and how to prepare for it. It is coming, sooner or later.”

    Now would be a good time for policy makers to put on their thinking caps. Here’s hoping that this report has made it to the top of their offices’ post-Labor Day reading list. 

     

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  • ARPN’s McGroarty for Investor’s Business Daily: U.S. Mineral Resource Dependence a “Clear and Present Danger”

    Against the backdrop of growing threats to U.S. security – recent flash points involve Russia, China, Iran, and North Korea – a new Presidential Executive Order “On Assessing and Strengthening the Manufacturing and Defense Industrial Base and Supply Chain Resiliency of the United States,” zeroes in on defense readiness. The E.O. requires heads from various cabinet departments to submit to the President policy recommendations for strengthening the U.S. defense industrial base.

    The problem, as ARPN’s Daniel McGroarty outlines in a new commentary for Investors Business Daily, runs far deeper than scenarios in which “there is only one U.S. company that can repair submarine propellers – (…) Our metals and minerals dependency on foreign sources of supply is great and growing.”

    ARPN followers are familiar with the overall picture: According to the U.S. Geological Survey, we are 100% reliant on foreign imports for 20 metals and minerals. For another 50, we are more than 50% import dependent – with China being a leading supplier for 28 of the 50. 

    McGroarty points to fused aluminum oxide to underscore the severity of the situation, arguing that “there’s nothing quite like a raw material shortage to bring the lengthiest supply chain to a standstill:” 

    While we are more than 75% import dependent for our annual domestic fused aluminum oxide supply, according to USGS, defense-grade aluminum fused oxide is even harder to come by, leaving our import dependency for this material at 100%, with the world’ leading providers being China and Venezuela – none of which are the poster children of reliable trading partners. 

    Says McGroarty:

    “In announcing the Executive Order, Navarro noted that it ‘does not silo defense, the economy and trade and the workforce,’ but embraces ‘all the interconnections between a strong manufacturing base, a strong industrial base, a strong workforce … that strengthen our tax base which … allows us to buy the material and weapons.’

    A fine and expansive statement, to which we should make a one-word amendment: Instead of buying the strategic materials used in U.S. weapons platforms, whenever we can, we should be mining that material here at home.

    And that requires reversing the slide that has seen the U.S.’s share of global mining exploration investment in steady decline the past two decades, even as the length of the federal permitting process has doubled. Here, we need not wait for the President’s Defense Industrial Base report; we should press for passage of critical minerals legislation now before the Congress, with meaningful permitting reform.”

    McGroarty has additional suggestions as to what can be done to foster a policy environment conducive to harnessing our nation’s arguably vast mineral potential, and calls for the realization of the strategic importance of mainstay metals like Copper, which in the tech metal era, serve as “Gateway metals” to other critical minerals. 

    He concludes:

     “Defense readiness has long been a key bulwark of American strength — and worrying about it has an equally lengthy pedigree. In his oft-quoted farewell address, in a largely overlooked passage, President Dwight Eisenhower warned: ‘We can no longer risk emergency improvisation of national defense.’ That was 1961, at the height of the U.S.-Soviet Cold War.

    In 2017, with threats emanating from Moscow, Beijing, Pyongyang and Tehran, this is one instance where it would pay for America to Be Like Ike.” 

    The time for a strategic overhaul of our mineral resource policy is now. 

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  • Critical Materials Institute Meets “Stretch Goal” to Produce REE Magnet Domestically

    Meeting one of its “stretch goal[s] to demonstrate that rare-earth magnets could be produced from mine to manufacturer, here in the United States,” the Critical Materials Institute (CMI) a U.S. Department of Energy Innovation Hub, has announced that the has fabricated magnets made entirely of domestically sourced and refined REEs.  This success was achieved in [...]
  • USGS Highlights U.S. Mineral Resource Dependence and Associated Risks

    At ARPN, we have long argued that our over-reliance on foreign minerals is problematic – particularly in light of the fact that the United States itself is home to vast mineral resources. Recognizing the importance of the issue, the United States Geological Survey (USGS), which has long been a formidable source of relevant data and [...]
  • The U.S. Tomahawk Strike – Syria, Russia … and China?

    While the world media mulls the impact of the U.S. airstrike on Syria in the wake of the sarin gas attack and marvel at the accuracy of the Tomahawk cruise missile, friends of ARPN are reminded that the rare earths critical to the Tomahawk’s terminal guidance system are sourced from China. An interesting sidebar to [...]
  • Guest Commentary: Jeff Green On New Congressional REE Policy Initiative

    The following is a guest post by American Resources expert and J.A. Green & Company president and founder Jeffery A. Green The United States has placed itself in a very precarious situation with respect to its ability to produce and refine strategic and critical materials. Over the past few years we have willfully ceded our last remaining [...]
  • Cobalt – First Steps Towards Reducing Mineral Resource Dependencies?

    A recent piece for InvestorIntel zeroes in on a metal which, due to its growing use in battery technology, coupled with a challenging supply scenario is increasingly afforded “critical mineral” status – Cobalt. A co-product of Nickel and Copper, the metal’s recent history, as author Lara Smith argues, has been “chaotic.” ARPN agrees that about sums it up. Criticism regarding the [...]
  • Interview: AEMA’s Laura Skaer – The Mining Industry’s Challenges and a Look Ahead

    For the last few months, politics has sucked up much of the oxygen in Washington, DC and around the country.  With the inauguration of the 45th President of the United States behind us, many of us are hopeful that the time has come to finally shift the focus away from politics toward policy. Against the backdrop [...]
  • Through the Gateway: “Fairy Dust” Supply Woes Loom

    As we continue our look Through the Gateway, comes a stern reminder by way of Canada that the geopolitics of resource supply represents a complex issue warranting comprehensive policy approaches.   And it literally concerns a metal that touches us — more precisely, we touch it — every day, too many times to count. A decision to [...]
  • Through the Gateway: Vanadium – Next-Gen Uses Drive Co-Product Challenge

    As we continue our look “Through the Gateway,” one thing has become abundantly clear already:  Beyond their traditional uses, both Gateway Metals and their Co-Products have become building blocks of our renewable energy future.  This held true for Copper and its Co-Products, but it is also equally true for Aluminum and its Co-Products. While Gallium’s [...]

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