Federal Government Announces $1.2 Billion Critical Minerals Strategic Reserve
The Federal Government has unveiled plans to create a Critical Minerals Strategic Reserve, pledging $1.2 billion.
The policy aims to enhance Australia’s economic resilience and national security by shifting the country from a supplier of critical minerals to a global market leader. The Reserve would strategically leverage Australia’s rare earths and high-tech materials to support the energy transition.
A National Reserve for a Global Opportunity
Prime Minister Anthony Albanese said the Reserve comes at a vital time for the nation.
“In a time of global uncertainty, Australia will be stronger and safer by developing our critical national assets to create economic opportunity and resilience,” Albanese said.
“To leverage our natural resources is in our national interest.”
The Reserve will operate through two key mechanisms:
- Voluntary national offtake agreements
- Selective stockpiling of critical minerals
The Federal Government will be able to purchase set volumes from commercial projects or secure purchase options at a fixed price.
“The Strategic Reserve will mean government has the power to purchase, own and sell critical minerals found here in Australia,” Albanese said.
“It will mean we can deal with trade and market disruptions from a position of strength.”
Boosting the Critical Minerals Facility
The $1.2 billion initiative includes a $1 billion boost to the existing Critical Minerals Facility, lifting its total value to $5 billion. This funding will support projects through early development and market entry stages.
Industry Welcomes Strategic Support
AMEC CEO Warren Pearce said the move is a much-needed injection of confidence for investors and the private sector.
“It will provide support to the private sector and assist international investors and partners with the upfront capital costs of new projects,” Pearce said.
“In the geopolitical context of today, critical minerals are more important than ever. This policy setting will help Australia leverage our position as a major critical minerals player in the global market.”
Minerals Council of Australia CEO Tania Constable welcomed the investment but noted it must be handled carefully.
“We must focus on the fundamentals that will give Australia back the edge over other mining nations,” Constable said.
“These changes would make it easier for companies to invest in Australia, without the need for taxpayer-funded incentives and government intervention in markets.”
CME WA CEO Rebecca Tomkinson said the announcement is a significant opportunity for Western Australia.
“Recent trade and geopolitical disruptions present a golden opportunity for Australia to attract the significant investment required to unlock our world-class critical minerals endowment,” Tomkinson said.
“Like other critical minerals, the market for rare earths is thin, opaque and subject to unpredictable price swings, which has acted as a major barrier to getting projects off the ground.
“Federal Labor’s plan to offer voluntary offtake agreements that allow producers to lock-in stable and predictable revenue may assist in bringing projects to market by enhancing their attractiveness to investors.”