PATRICIA KARVELAS: There have been two key focuses of the Prime Minister’s trip to Washington – progress on AUKUS and progress on climate investment, including on critical minerals. While conflict in the Middle East has really overshadowed some of that, there has been movement in both of those areas, including new investment in critical minerals mining. Madeleine King is the Minister for Resources. She’s also in Washington with the Prime Minister. She joined me a short time ago. Minister, welcome to RN Breakfast. 

MINISTER MADELEINE KING: Pleasure to be here, Patricia, all the way from Washington. 

PATRICIA KARVELAS: You’ve announced $2 billion for critical minerals mining. This doubles funds available for low-interest loans for both miners and processors. So who’s eligible for it? 

MINISTER MADELEINE KING: Well, there’ll be a process that the Export Finance Australia does with the Critical Minerals Facility, an extra $2 billion, as you say, where projects will be identified, or they will self-identify, and there is quite a rigorous process applied to any loans given out by the Export Finance Australia, just like there is with the Northern Australia Infrastructure Facility. So it will be – projects will be assessed as they come about basically. But what they will be targeting, though, is important critical minerals and rare earths projects. And usually – I expect it may be extraction, but I think processing will be really one of the things the Critical Minerals Facility will focus on. 

PATRICIA KARVELAS: Does it matter whether or not processing critical minerals in Australia can be done at a competitive price? 

MINISTER MADELEINE KING: Well, the thing is it can be done at a competitive price. But what we need to do is to get the projects off the ground. And that is the challenge with rare earths and critical minerals. So once projects are going and are producing, the price tends to be acceptable. But it’s the initial investment is the real challenge. And because large financiers find it difficult to get involved in these projects because there can be manipulation of the market by the dominant player in it, which is China. So this is, you know, part of making sure Australia’s geology has the ability to compete, especially with the real start and germination of these projects. 

PATRICIA KARVELAS: Has China – I mean, you just mentioned there can be – has China been manipulating the market to game the system? 

MINISTER MADELEINE KING: Well, no, China’s just ahead of the game. Like, they’ve been mining and processing rare earths and critical minerals for 20 or 30 years, well ahead of most Western democracies. And I think the truth is many countries outsource its mining capacity to China, and they’ve invested in that. They’ve developed their processing facilities while the rest of the world has not done so. I think the pandemic showed us that there is a vulnerability in each of our economies when we rely – for any product I might add – when we rely on a one supplier of a particular commodity. And that obviously applies to critical minerals. And for Australia, we have the geology that produces those critical minerals. So it will be crazy not to make sure we develop that industry, and we’re drawing on, you know, past experience. We have lithium – one of – the biggest lithium hard rock mine in Greenbushes in Western Australia, but we have others as well. Kathleen Valley from Liontown, the Wodgina mine up in the Pilbara with the mineral resources. But we need to make sure that we can get more projects going as well so that we can diversify that supply chain. 

PATRICIA KARVELAS: Minister, you and the Prime Minister have both spoken about securing the critical minerals supply chain with the US. The government has already underwritten the processing capacity for one company. Will you expand that? 

MINISTER MADELEINE KING: We will expand the projects as they need to be expanded and become eligible for the Critical Minerals Facility. So, the government – government financing organisations have been involved in a number of critical minerals projects. So, I’m not sure the one you’re speaking of, but we also have, you know, through the NAIF that I mentioned earlier, they’ve certainly invested in other critical minerals projects. 

PATRICIA KARVELAS: Now, you’ve had this critical minerals roundtable in Washington this week. What’s been the tangible outcome out of that? 

MINISTER MADELEINE KING: Well, the tangible outcome has been certainly making really solid connections with friends in the US administration and getting targets set around what we can achieve together. The history of America and Australia is one of mutual investment. So we’re our biggest partners in investment. We invest most into America and they invest the most here in Australia. So we just want to make sure that can also be focused on the new and emerging resources sector of critical minerals. And that was a lot of the substance of our discussions. So, one of the outcomes, America’s EXIM, so the export-import bank, will work with Export Finance Australia to identify projects and seek to make sure they get off the ground. So it’s a very tangible outcome in relation to getting more critical minerals not only mined but, importantly, processed in Australia with that value-adding taking place across our country. 

PATRICIA KARVELAS: Minister, the extra $2 billion will go to, I think, mining companies, but China, we know, has a stronghold over the processing part of this. Will the government invest in that next stage? 

MINISTER MADELEINE KING: Absolutely. And that is – this Critical Minerals Facility will invest in processing, I’ve no doubt. We know that the facility before – 

PATRICIA KARVELAS: But doesn’t that need to be the emphasis? 

MINISTER MADELEINE KING: Well, it can be both. We’ll have to see what projects come forward, but whether it’s – you know, I’m not going to say or mandate to the energy – Export Finance Australia a particular percentage of whether it’s mining or processing. But we know we also have other investments into processing and the value-adding and resources part of the National Reconstruction Fund is $1 billion. So that’s another potential means of supporting that processing capacity. Again, as I said, the NAIF is also available to help the processing capacity. But we know that is just for Northern Australia. So the Critical Minerals Facility is another one that does capture projects across the rest of Australia as well. So it may invest in mining, but it will also invest focus on processing as well. Basically, we need to get this industry going and all parts of it, whether it be mining and extraction through to concentration processes and then further processing going through to precursor allied metals and metallisation. So there’s about four or five steps along the value chain that the Critical Minerals Facility will be available to invest in. 

PATRICIA KARVELAS: This week China announced new export restrictions on graphite, and earlier this year they announced restrictions on two other critical minerals. If Australia doesn’t build the refining and the processing part of this, how vulnerable are we to those restrictions? 

MINISTER MADELEINE KING: Well, yeah, it’s a very good point. And when any country that dominates a market, such as China does with graphite and gallium and germanium then, yeah, we absolutely are susceptible to those kind of export bans. But in positive news, though, two of the projects that the Critical Minerals Facility already is involved in is around graphite. So EcoGraf in Western Australia produces spherical graphite, and that’s one of the projects the CMF has aided in its financing before. And also Renascor in South Australia is another project. So I’ve been actually speaking about these very projects to our American friends over the past couple of days because, you know, anyone that wants to buy a commodity and it suddenly gets banned from export, you know, obviously worries about that. But we are fortunate to be able to, you know, reassure other countries that we produce graphite as well. We’re producing graphite because of the Critical Minerals Facility and the government’s involvement in making sure these projects get off the ground. 

PATRICIA KARVELAS: Minister, the industry – in fact, the Chamber of Commerce and Industry in WA say an issue stopping more critical mineral mining are delays in environmental approvals. Are you prepared to fast-track the environmental approvals for these projects? 

MINISTER MADELEINE KING: Well, I meet with all the resources ministers across the country. We have a resources ministerial forum, and this comes up, understandably. We need to make sure our approvals processes are thorough but also efficient because we need that certainty for both proponents but also, you know, those that have concerns about how a mine might come to be. So I think we need to accept that the starting point is we want to have a mining industry that has high environmental standards. And there’s no swapping out of that. Like, that is a baseline matter that we want to make sure is addressed. How we then address it and the approvals process and avoiding duplication of processes, that’s where efficiencies in that approval process can have between federal and state governments. So I accept what the CCIWA is saying – we need to do better on approvals. But, equally, we can’t, you know, ride roughshod over environmental approvals because they are vitally important. But we also must remember that we will not decarbonise our economy, we will not reach net zero by 2050 without mining more critical minerals. Like, that’s a baseline issue we all need to understand. 

PATRICIA KARVELAS: Minister, just on a couple of other issues, as you know – you’re in Washington – the Prime Minister has held a press conference with the United States President Joe Biden, and Joe Biden has warned Australia about the risks of dealing with China saying that the US is a more reliable partner essentially. The Prime Minister, of course, is about to go to China. I think it’s about a week away. He goes to China for that key meeting. Do you think that that warning will be heeded? I mean, do you see it that way too – that the US is a much more reliable partner and we should be wary? 

MINISTER MADELEINE KING: I’m not sure – I was that press conference; that’s not what I took away from it. But I think the point is that you know, we need to have our eyes open with all our international relationships. And that’s an important thing to always consider. So, you know, we’ve been pretty clear as a government about our position in relation to China. We – they are our biggest trading partner and the iron ore industry of Western Australia is the backbone of not only the Western Australian economy but also the Australian economy. So we know how important those exports are to us. But, you know, even in the difficult trade relationship we’ve had over the last few years, it’s the trade in resources that has underpinned that relationship with China and it’s been successful. BHP just celebrated 3 billion tonnes of iron ore going to China over the last couple of decades. So, you know, that’s an important ballast in that relationship and it’s one we can absolutely agree on. But we do have our differences with China, and as the Prime Minister has always said, you know, we will agree where we can and disagree where we must. And we’re very clear-eyed about this, and we intend to remain so. 

PATRICIA KARVELAS: Minister, just finally, on the Middle East, a pretty difficult situation unfolding there. Are you concerned that we’re seeing a humanitarian crisis unfold and that there needs to be a pause to get more aid in? 

MINISTER MADELEINE KING: Well, there’s no doubt it’s a tragic circumstances in the Middle East, the kind of conflagration no one wants to witness. And the loss of innocent lives is appalling. We have a terrorist organisation, Hamas, attacking Israel and Israelis, and it has brought a terrible, you know, devastation on the area. We need to get aid to people, absolutely. But it’s a very challenging circumstance. And I know leaders around the world are working very hard to make sure that aid does get to the people that need it. 

PATRICIA KARVELAS: Thank you so much for joining us. 

MINISTER MADELEINE KING: Thanks, Patricia. 

PATRICIA KARVELAS: Resources Minister Madeleine King.