The Australian federal government is setting up a $2bn loan facility designed to fill ‘financing gaps’ in critical minerals developments.

Global demand for  critical minerals needed for clean technology applications — like lithium, graphite, vanadium, tungsten, cobalt, manganese, zirconium, scandium, molybdenum, hafnium and rare earths — are expected to grow exponentially over the coming decades.

The facility, to be managed by Government agency Export Finance Australia, is aimed at setting up commercial critical minerals projects to boost supply security and reduce the reliance on dominant market participants such as China.

“The commercial dimensions of the critical minerals market mean it is a difficult place to get established,” Prime Minister ScoMo says.

“We want to ensure that Australia’s resources producers do get established so they can link up with others in our supply chains in a free and open Indo-Pacific.”

Minister for Resources and Water Keith Pitt said the Government’s new $2 billion Critical Minerals Facility would ensure Australia remains at the forefront of emerging new opportunities in the global resources sector.

“Australia is already among the world’s top suppliers of some of the world’s most sought-after critical minerals and we know there is enormous potential through our untapped reserves,” Pitty says.

“The lithium industry alone, which is essential to develop new battery technology, is forecast to be worth $400 billion globally by 2030 and initiatives like this will mean Australia is well placed to grab its share of the market.”

The fund will operate on the National Interest Account for 10 years or until finance equivalent to $2 billion has been provided.