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To: LoneClone who wrote (168290)	11/3/2022 1:36:00 PM
From: LoneClone	Read Replies (1) \| Respond to of 196029

Ottawa orders Chinese companies to exit three Canadian lithium miners msn.com Naimul Karim - 1h ago Ottawa has ordered three Chinese companies to divest their investments in three Canadian junior lithium miners as it looks to strengthen its hold on this country’s critical minerals projects amid rising demand for the commodities. Industry Minister François-Philippe Champagne said that following a “multi-step national security review process,” the government has asked Sinomine Rare Metals Resources Co., Chengze Lithium International Ltd. and Zangge Mining Investment Co. to divest from Canada’s Power Metals Corp., Lithium Chile Inc. and Ultra Lithium Inc., respectively. These steps were taken under section 25.4(1) of the Investment Canada Act (ICA), which gives the government the power to require non-Canadians “to divest themselves of control of” a Canadian business if it believes the investment could be injurious to national security. “In accordance with the ICA, foreign investments are subject to review for national security concerns, and certain types of investment — such as those in the critical minerals sectors — receive enhanced scrutiny,” Champagne said in a statement. “Therefore, we reviewed a number of investments in Canadian companies engaged in the critical minerals sector, including lithium.” Calgary-based Lithium Chile said “it was reviewing the options and potential outcomes of the order with Chengze.” It added that the investment made by Chengze has given Lithium Chile a “significant cash position,” but the government’s order “does not affect” the company’s assets or lithium resources. “The assets operated by (Lithium Chile) are owned through its South American subsidiaries in Chile and Argentina. The assets operated by the company are not Canadian assets, nor the company’s significant lithium resource,” Lithium Chile said in a statement. “The investment into the company by Chengze, does not equate to a control position, nor does it give Chengze special rights in respect to the outcome or decisions made by the company.” Lithium Chile said the investments by Chengze in 2022 followed ICA policies and were approved by the TSX Venture Exchange. The company added that it values the experience and expertise of Chengze and its ability to “efficiently develop its assets.” Patricia Mohr, an economist and former vice-president at the Bank of Nova Scotia, said the government has a tricky situation on its hands since Canada needs to attract foreign investment to its critical mineral industry, but there can be questions about the net benefits for the country when state-owned or controlled enterprises are involved. “China dominates world supplies of many critical materials … there is some need to prevent supply chain vulnerabilities from affecting industry in Canada and the West, particularly as the electric-vehicle and renewable-energy industries develop,” she said. Pierre Gratton, chief executive of the Mining Association of Canada, said the industry is very sensitive to both the geopolitical context and the difficult choices the government and its allies are facing. “Access to capital and markets is essential to allowing Canada to provide responsibly sourced critical minerals required for global decarbonization,” he said. The government’s orders come days after Canada raised the bar that foreigners must clear to join the country’s critical minerals industry. Any attempt by a state-owned enterprise to purchase assets in the sector can now trigger Part IV.1 of the ICA, which could require an extended review on the grounds that it could be “injurious” to national security. “These new and strengthened efforts will improve the administration of Canada’s investment review regime. To ensure transparency, we will continue to announce outcomes of such orders going forward,” Champagne said in a statement. He added that the government’s decisions were based on the advice of “critical minerals subject matter experts, Canada’s security and intelligence community, and other government partners” The policy shift comes after a parliamentary committee in March said Canada should launch a full security review for every investment by a company influenced by an “authoritarian state,” since that meets the ICA’s threshold of potentially being “injurious to national security.” Champagne’s decision to opt not to do so in January when Chinese miner Zijin Mining Group Co. Ltd. acquired Neo Lithium Corp., a mining company formerly listed in Canada that owned a lithium project in Argentina, led to controversy. Former Conservative leader Erin O’Toole criticized the federal government for allowing Zijin Mining to acquire Neo Lithium since the demand for critical minerals such as lithium needed for electric batteries was rising. He said the government had not done a proper security review. Champagne at the time said the deal was thoroughly reviewed . He also said Neo Lithium’s project would not be mining for lithium hydroxide but lithium carbonate, which Canada would not be relying on to produce electric batteries. China dominates the electric-vehicle (EV) supply chain through its refining and processing industries, even though most of the metals required by EVs, such as lithium, nickel and cobalt, are mined outside the country. Democratic countries in North America and Europe have been banding together to offset China’s dominance of the EV supply chain. For example, Washington’s recently passed Inflation Reduction Act offers a US$7,500 subsidy to encourage the production of EVs in North America, while Minister of Finance Chrystia Freeland has repeatedly stressed the need for “ friendshoring ,” an idea that democratic allies would build supply chains through each other’s economies and tackle the influence of authoritarian regimes in the energy sector. Email: nkarim@postmedia.com \| Twitter: naimonthefield