Governments must act swiftly to attract investment, accelerate development, and seize opportunities from the global energy transition while respecting Indigenous rights and protecting the environment.
New research from the Canadian Climate Institute – an independent charitable policy research organization – urges governments to de-risk critical minerals investment and speed up project timelines to avoid losing a multi-billion dollar economic opportunity. Six priority critical minerals—copper, nickel, lithium, graphite, cobalt, and rare earth elements—are essential for clean technologies like renewable energy and electric vehicles. Canada has barely tapped its reserves, despite growing global and domestic demand. By 2040, Canada risks losing $12 billion annually in critical minerals production unless mining ramps up to meet domestic needs.
Rick Smith, president of the Canadian Climate Institute, said, “Critical minerals represent a multi-billion dollar opportunity for Canada in a global energy transition that continues to pick up pace. But Canada’s critical minerals sector is struggling to attract enough investment to keep up with demand. As competition heats up and trade relationships evolve, Canadian governments should make haste to adopt policies to unlock private investment and bring resources to market faster—all while forming respectful partnerships with Indigenous communities and reducing environmental risks.”
Canada must secure $30 billion in new investment over the next 15 years to fully harness domestic potential and $65 billion to meet the doubled global demand expected by 2040. However, volatile market prices undermine investor confidence. Governments can stabilize investment by implementing targeted policies like equity investments, offtake agreements, or contracts for difference.
Critical mineral projects must actively prioritize Indigenous partnerships, respect Indigenous rights, and adhere to strict environmental protections. JP Gladu, founder of Mokwateh, emphasized, “All clean growth projects will rise on treaty lands, land claim areas, traditional territories, or near Indigenous communities. This unique moment in time allows Canada to affirm Indigenous rights to land and self-determination while fostering meaningful partnerships between Indigenous nations, industry, and government. The Canadian Climate Institute’s report clearly outlines how Canada can grow its critical minerals sector in full collaboration with Indigenous Peoples.”
The report recommends governments streamline project review processes without compromising Indigenous rights or environmental safeguards. It advises:
- Sharing financial risks with private companies for critical mineral projects
- Increasing funding for Indigenous communities to participate in mining and access ownership opportunities
- Strengthening regulations to reduce environmental risks and liabilities
- Improving review and decision-making efficiencies across jurisdictions
John Stackhouse, senior vice president at the Royal Bank of Canada, said, “Canada has a significant opportunity at hand to develop our critical mineral reserves, which among other imperatives are critical for a lower-emissions economy. This report clearly demonstrates the importance of making it easier for mining projects to secure financing to make this happen. By deploying loan guarantees and other financial risk-sharing instruments to de-risk projects, federal and provincial governments in Canada can crowd-in private capital and keep projects on track despite market uncertainty.”
The Climate Institute also published three companion papers on Indigenous participation, emissions impact, and environmental risk reduction in the critical minerals sector.
More information is posted on www.ClimateInstitute.ca.
