Saskatchewan government agrees with feds’ move on critical minerals

Putting aside the many places where they disagree, the Saskatchewan and Canadian governments are on the same side of at least one subject these days — limiting foreign investment in Canada’s critical minerals.

On Friday, federal Innovation Minister Francois-Philippe Champagne announced the country would be restricting foreign investment in Canada’s critical minerals sector in order to protect it.

He said Canada’s critical minerals and metals are integral to the country’s prosperity and growth going forward. The minerals and metals are integral in batteries and green technology that’s expected to only be more in demand as things go forward.

Those include rare earth elements, which Saskatchewan’s government has been touting highly recently.

Saskatchewan’s trade and export development minister, Jeremy Harrison, said the province is supportive of that announcement.

“In fact, I think very much the federal policy mirrored the provincial government’s policy that we submitted during the PotashCorp discussion back in 2010,” said Harrison.

Brad Wall’s government had expressed concern over a Chinese state-owned company being able to have such a big stake in a resource so integral to Saskatchewan.

One of the reasons Harrison supports the move is that it doesn’t necessarily stop investment altogether.

“(It puts) in place safeguards to make sure that any investment outside of Canada is in the net interest of Canada and accounts for the fact that we have some very, very substantial reserves of critical minerals here in this province,” said Harrison.

The Government of Saskatchewan has put millions of dollars into developing the rare earth elements industry in the province, including funding a processing facility in Saskatoon to the tune of more than $50 million.

In August, the province held an event to show off the metal ingots produced by the facility.

Despite the province’s interest in growing the industry, Harrison isn’t concerned the federal rules will slow things down. He said the policy strikes a good balance.

“It doesn’t prohibit and preclude investment from outside of Canada but there is an assumption that that investment needs to be reviewed to ensure, at the front end, that there is a net benefit for Canada in having that investment,” explained Harrison.

There has already been foreign investment in Saskatchewan’s rare earth elements, including from an Australian company, Vital Metals Ltd.

The concern is that Chinese state-controlled companies have the vast majority of the critical minerals manufacturing sector, and there are worries about supply chain issues, as well as concerns about those companies being beholden to the whims of the country’s government.

“These are the sort of things that we have to be very, very aware of as a country,” said Harrison.

In 2016, Chinese company Yancoal was given conditional approval to start moving on a potash mine near Southey — another of the resources which the Saskatchewan government feels is very important to the province.

But Harrison said there’s been really no movement on that project and, if the company did want to start things up, there would likely have to be more review. He said the province would work with the federal government on the Investment Canada Act on that one.

On Thursday, the federal government ordered Chinese firms to divest themselves of their holdings in three Canadian critical minerals companies as part of a wider move to create a critical minerals strategy in Canada.