Published on 24 January 2024 in Client Alerts
Her comments were made in Riyadh on 9 January 2024, on the occasion of the Kingdom of Saudi Arabia’s third annual Future Minerals Forum. The Future Minerals Forum gathers high-ranking government officials and senior members of the private sector from the world’s largest mining and energy companies to discuss the creation of resident and responsible mineral value chains across Africa and Asia. Speakers this year included government ministers from Saudi Arabia, the Democratic Republic of the Congo, Finland, Ghana, Kazakhstan, Nigeria, Pakistan, Somalia, Uganda, the United Kingdom, Zambia and Zimbabwe, as well as leaders from many of the world’s largest mining companies and leading civil society organisations.
Speaking at the event, the UNEP’s Executive Director emphasised the importance of long-term strategies to securing supplies and commended the Future Mineral Forum’s focus on resilient mineral value chains. Among other things, she called on governments to consider ways to strength and harmonise policies to encourage responsible extraction of energy transition minerals. She highlighted the announcement by the UN Secretary-General at COP28 of a new Panel of Critical Energy Transition Minerals, which will develop common voluntary principles for sustainable extractive sector industries.
As many government and private sector actors have long recognised, securing supply chains of critical raw materials will be crucial to driving the clean energy transition. In 2022, for example, the OECD’s International Energy Agency sounded a warning that current supply and investment plans for critical minerals fell well short of levels needed to support the clean energy transition. It warned that this risked delaying or increasing the cost of clean energy transitions, “a possibility that the world [could] ill afford”. The UNEP’s public call for increasing investment into energy transition minerals should be viewed in this light.
The position of the UNEP – one which will have been carefully agreed and coordinated – demonstrates the nuanced and complex approach needed to mining (and promoting mining-related investments) in order to manage climate change. The UNEP’s recent comments are particularly notable for having been made by Ms Inger Andersen, who until 2019 served as Director-General of the International Union for Conservation of Nature.
Governments and private actors alike are paying increasing attention to the need to secure supplies of critical raw minerals, ranging from cobalt, lithium and rare earth elements to the steelmaking coal required to drive forward renewable energy. In recent years, Australia, the UK, the US and the EU have all adopted critical mineral strategies in order to secure supplies and scale up domestic production. The EU recently redesignated steelmaking coal on its list of critical raw materials, while Australia has considered a similar designation. This reflects an unequivocal recognition of the fundamental difference between steelmaking coal (also known as metallurgical or coking coal) and thermal coal. As its name suggests, steelmaking coal remains a crucial component of steelmaking processes required to deploy wind turbines and other clean energy infrastructure. At the same time, following recent major legal developments, governments and private actors are increasingly pursuing deep sea mining to secure critical minerals for the clean energy transition. Most notably, Norway and the Cook Islands have accelerated efforts to mine the seabed within their national jurisdiction. At the international level, the International Seabed Authority (with nearly 170 member States) has granted over 30 mining contracts for the exploration of deep seabed minerals in the seabed beyond national jurisdiction. Efforts continue at the International Seabed Authority to enable these contractors to move from exploration into exploitation, a process triggered at the specific request of the Republic of Nauru.
States and companies alike will be looking carefully at how best to secure long-term and stable supplies of in-demand critical minerals. Working in partnership with local regulators, significant opportunities exist for private sector actors to drive increasing investment into securing critical minerals. At the same time, cross-border investment into long-term mining ventures continues to carry major risks. Investors should therefore take proactive steps to ensure that their mining investments are properly structured. If so, they may be able to attract significant protections under an international investment treaty that host States can neither ignore nor escape.
For further information, please contact info@volterrafietta.com.
In the brief 60 years of space flight, humanity has sent over 60,000 space objects and 1 million pieces of smaller debris into orbit around the planet. This has created the risk of a legal and physical log-jam in space. The congestion and space-junk problems are projected to become even more acute as the space race broadens its participants.
Learn moreDuring the 29th annual session of the International Seabed Authority (“ISA”), Malta, Tuvalu, Honduras, Guatemala and Austria declared their support for a precautionary pause on deep-sea mining. To date, now over thirty States have called for a halt in the exploitation of the deep seabed minerals. These calls come as the ISA struggles to adopt a final set of regulations on mining exploitation.
Learn moreOn 30 May 2024, the European Council adopted decisions enabling the European Union (“EU”) to denounce (the proper international law term for ‘withdraw from’) the Energy Charter Treaty (“ECT”).
Learn moreThe COVID-19 pandemic exposed significant gaps in the global health system, leading to immense human and economic losses. In response, the World Health Organization (“WHO”) and its member States decided to draft a comprehensive international treaty—the Pandemic Prevention, Preparedness, and Response Accord.
Learn more