International companies see opportunity in Canada’s critical minerals resources

Global mining and advanced chemical firms are increasing their investment in Canada, which means new jobs and an accelerated transition to sustainability for Canadians

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When Livent decided to increase its investment in Nemaska Lithium Inc. in Quebec, its leadership was signaling its confidence in Canada’s lithium industry and thinking about the possibilities related to further supporting Canada’s electric vehicle (EV) ecosystem.

Philadelphia-based Livent, which produces lithium from sites in Argentina and has plants in the United States, England, Argentina and Asia, bolstered its commitment to the Montreal-based company in 2022 when it announced it was doubling its ownership interest in Nemaska to 50 per cent. Lithium is essential in producing EV batteries and Nemaska Lithium is expected to have a production capacity of 34,000 tonnes of lithium hydroxide a year, with first production planned for 2026.

“Nemaska and the province of Quebec are building an integrated battery supply chain, and that’s something we are very supportive of,” says Sarah Maryssael, Livent’s chief strategy officer, adding EVs are the cars of the future and global economies will increasingly rely on lithium. “We want to be a partner and help them execute on that vision.”

Canada has a long history of mining and minerals processing. Most of the country’s diamonds are mined in the Northwest Territories, while Ontario and Quebec lead the country in gold production. Saskatchewan produces all of Canada’s uranium and has world-class potash reserves. British Columbia is prominent in copper and in steelmaking coal production. Nova Scotia has a thriving salt industry, most of which is used for de-icing, but some is also transformed into food-grade products, including table salt. And Newfoundland and Labrador and Quebec produce virtually all of Canada’s iron ore. The industry contributed $67.5 billion to Canada’s GDP in 2020 and directly employs 337,000 people, with another 315,000 employed in ancillary roles. This history and expertise are particularly appealing to foreign direct investment (FDI), which benefits Canadians looking for jobs in this booming industry.

“There is a very skilled labour force here,” Maryssael says. “Globally, there is a shortage of young people going into these careers. However, Canada has a very strong pipeline of skills, which will really help in becoming a global hub for critical minerals in the energy transition.”

Of course, Canada’s critical minerals resources are attractive to a wide range of international companies. Around the world, businesses are prioritizing lower-carbon initiatives to help meet industry-wide environmental goals and lower carbon emissions, and Canada is viewed as a leader due to its supply of critical minerals such as nickel, potash, aluminum, and uranium. These valuable resources are used in everyday items like laptops and stainless-steel appliances, but also crucially aligned with building a greener economy. For example, wind turbines need manganese, platinum and rare earth magnets, and solar panels rely on indium and tellurium as key manufacturing materials.

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Alcoa, a Pittsburgh-based producer of aluminum, has long invested in Canada. Louis Langlois, senior vice-president and treasurer, says the company has about 2,500 employees in Quebec and contributes more than $1.8 billion to the local economy. Langlois says Alcoa has operations in Quebec because Canada has the ability to provide long-term access to clean energy and holds an esteemed aluminum production ecosystem — suppliers, equipment and manufacturers — that make it a key player in the global industry.

“More countries are looking to diversify their supply sources for critical minerals and buy aluminium with a reduced carbon footprint, and Canada is very well positioned to be a supplier for that metal,” Langlois says, adding the country has trade agreements with all other G7 countries.

Like Livent, Alcoa is committed to its Canadian operations. It’s engaged in ELYSIS, a joint venture working to scale up a carbon-free smelting technology which Alcoa first developed at its research and development (R&D) center. The company also works with Laval University on R&D projects as well as other partners to develop a diverse workforce. “Canada has the ability to have an even bigger role in the global aluminium industry,” Langlois says.

Sustainability is another important draw for foreign companies. The country’s environmental, social and corporate governance (ESG) gives Canada a competitive advantage over many other countries, says Pierre Gratton, president and CEO of the Mining Association of Canada (MAC). “Our abundance of clean power means our minerals and metals emit some of the lowest carbon in the world.” All companies operating in this space must follow a MAC-developed and -implemented ESG program, Towards Sustainable Mining, which prioritizes Indigenous engagement, biodiversity protection and climate change. It should come as no coincidence that at PDAC 2023, the Prospectors & Developers Association of Canada’s annual conference March 5-8 in Toronto, environmental and social responsibility are key conversations.

These practices are important when it comes to building relationships with different Indigenous groups. Critical-mineral-rich regions are spread across the country — including in remote Indigenous communities — making it vital to work in partnership with local peoples to cultivate meaningful consultation and engagement in mining projects. “Indigenous rights are constitutionally respected and increasingly embedded in legal frameworks,” Graton says.

Livent’s Maryssael says that not only are countries and corporations thinking about their carbon footprints and social responsibilities, but consumers are too, adding they want to know the products they use are as sustainable as possible.

“Canada, with its strong mining code and extensive history in mining, really provides those guarantees to consumers,” she continues. “Minerals that are produced in Canada are done according to very high standards.”

And this isn’t just good for skilled Canadian workers, who will benefit from FDI-created job opportunities for generations to come. It’s also good for all Canadians, who benefit when the mining industry makes sustainability its focus.

Advertising feature produced by Globe Content Studio with Invest in Canada. The Globe’s editorial department was not involved.