Multi-million-pound investment by UK taxpayers in the UK’s first-ever magnet materials refiner launches alongside Critical Minerals Strategy
A multi-million-pound investment in the UK’s first-ever magnet materials refiner was launched today (Friday 22 July 2022) – securing hundreds of jobs in East Yorkshire, and a strong foothold for Britain in the international market.
This comes as the government publishes the UK’s first ever ‘Critical Minerals Strategy’ to bolster the resilience of supply chains and seize on the economic opportunities of growing industries, such as electric vehicle manufacturing and offshore wind.
Speaking at the official opening of Pensana’s £145 million Saltend site today, Business Secretary Kwasi Kwarteng confirmed that the facility will be developed to process the critical minerals used in magnets, a key component for manufacturing electric vehicles (EVs).
Pensana expects operations to begin at the end of 2023.
The facility is backed by the taxpayers' Automotive Transformation Fund, an £850 million programme to electrify Britain’s automotive supply chain and protect our nation’s competitiveness in the global market. It will make the UK one of the only places in Europe to have the facility to refine the rare earth oxides used in the creation of magnets, and will also lead to the creation of 126 new and skilled jobs in the area.
As set out in the new ‘Critical Minerals Strategy’, minerals such as graphite, lithium and silicon are vital to the economy, as they are key components of products ranging from laptops to aircraft. But supply chains are complex and markets are volatile, with most critical minerals sourced from just a handful of countries, particularly China. This leaves UK jobs and industries reliant on minerals vulnerable to market shocks and geopolitical events. Ensuring UK firms have a resilient and sustainable access to critical minerals will be vital for the growth of future industries such as EV manufacturing, which will support jobs across the UK for decades to come, and national security.
That’s why today’s strategy sets out plans to develop more robust supplies of these minerals for the vast range of industries reliant on them, protecting Britain’s interests into the future.
The measures include bolstering domestic production, building the UK’s skills base, carrying out world leading research and development, and enhancing reuse and recycling. It also notes the importance of working with international partners and like-minded allies to build trading relationships and diversify supply chains.
Business and Energy Secretary Kwasi Kwarteng said:
Pensana Chairman Paul Atherley said:
Production of critical minerals is expected to rise sharply – some as much as 500% by 2050.
They are often irreplaceable in the products people rely on for their daily life, in clean technologies and national security – from electric vehicles and mobile phones to wind turbines and fighter jets.
The new strategy sets out an ‘ACE’ framework, with plans to accelerate growth of the UK’s domestic capabilities, collaborate with international partners, and enhance international markets. Work to develop the UK’s onshore supply chains forms just one part of what is planned domestically, with a focus on rebuilding skills, boosting research, and recycling and reusing more as well.
Actions are also planned to use the City of London’s unique position as a global trading hub for metals and minerals to make global markets more effective in delivering the minerals we need. Part of this will be to push for better environmental, social, transparency and governance standards in critical mineral markets worldwide. Holding the market for critical minerals to higher standards helps reduce the likelihood of unforeseen events causing supply problems.
The UK’s mineral mining heritage dates back to the Bronze Age. Cornish tinners, for example, were renowned and exported their innovations and expertise around the world. The UK has pockets of mineral wealth including lithium, tin, tungsten and others, found from the Highlands of Scotland to the tip of Cornwall, as well as clusters of expertise in refining and material manufacturing.
This follows the creation of the UK’s first Critical Minerals Intelligence Centre (CMIC) based in Nottingham. The Centre will improve the resilience of the UK’s critical mineral supply chain by providing policymakers with up-to-date data and analysis on supply, demand, and market dynamics.
Notes to Editors
1. Government support for the Pensana Saltend facility was provided through the taxpayer-funded Automotive Transformation Fund, the automotive pillar of the Global Britain Investment Fund. The Automotive Transformation Fund is an £850 million programme to industrialise the EV supply chain. This includes unlocking private investment in gigafactories, battery material supply chains, motors, power electronics, and fuel cell systems. It is being delivered by the Advanced Propulsion Centre, based in Coventry.
2. The situation surrounding critical minerals – and which minerals are considered ‘critical’ – is constantly evolving. In January, the British Geological Survey (BGS) undertook the first UK criticality assessment. The BGS have now been appointed by the government, to run the Critical Minerals Intelligence Centre, which will regularly update this assessment and provide policymakers with a range of up-to-date data and analysis on supply, demand, and market dynamics.
3. The government draws on expert knowledge on critical minerals from across academia, finance, and industry, through the Critical Minerals Expert Committee. The Committee will continue to meet, to advise on the delivery of the Critical Minerals Strategy.
4. The government is also supporting businesses with taxpayers' money that are working on access to new, innovative sources of raw materials found in the UK.
5. Cornish Lithium and Geothermal Engineering are collaborating to build a zero carbon, lithium extraction pilot plant at an existing site in Cornwall. This £4 million project will be part supported from the government’s ‘Getting Building Fund’, via a £14.3 million allocation to the Cornwall and the Isles of Scilly Local Enterprise Partnership (LEP).
6. Cornish Lithium, alongside the Natural History Museum and Wardell Armstrong, were awarded over £350,000 for the project ‘Securing a Domestic Lithium Supply Chain for the UK (Li4UK)’.
7. In August last year, British Lithium Limited (BLL) was awarded an Innovate UK Smart Grant, with match funding of up to £500,000 from the government to progress its research and development of hard rock lithium extraction in the St Austell area of Cornwall.
8. The UK is already working with international partners through groups like the Minerals Security Partnership, and the International Energy Agency’s Critical Mineral Working Group, to responsibly develop global supply chains.
9. The government is also working closely with likeminded international partners to strengthen supply chain resilience.
10. The UK has a leading role in developing global standards in the critical minerals supply chain through work with the European Partnership for Responsible Minerals, the Extractives Industry Transparency Initiative, the UN, the G7 and others.
Industry support for the Critical Minerals Strategy
Jeremy Wrathall, Founder and CEO of Cornish Lithium said:
Sinead Kaufman, Chief Executive, Minerals at Rio Tinto said:
Duncan Wanblad, Chief Executive of Anglo American said:
Isobel Sheldon OBE, Chief Strategy Officer at Britishvolt said:
Maurits van Tol, Chief Technology Officer at Johnson Matthey said:
Paul Atherley, Chairman of Pensana said:
Nitesh Shah, CEO of Metalysis said:
Sir Mick Davis, CEO of Vision Blue Resources said:
Simon Moores, CEO of Benchmark Mineral Intelligence said:
Karen Hanghøj, Director of the British Geological Survey said:
Neil Glover, President of the Institute of Materials, Minerals and Mining (IOM3) said: