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An avalanche of critical minerals is coming for our most remote and disadvantaged communities

The Australian mining industry was promised billions of dollars in last week’s federal budget to boost critical minerals such as lithium, copper and rare earth metals. This includes tax incentives, an innovation fund and money for Geoscience Australia to map these resources.

Local investment in the extraction and processing of critical minerals also contributes to the new National Battery Strategy, announced this week.

But despite all this funding, virtually nothing has been allocated to help local communities engage in new mining activities. There are social and economic risks and opportunities, and all of them must be taken into account.

We map Australia’s critical mineral deposits against socio-economic data to identify communities most at risk. Our study shows that some of our most deprived areas have the most abundant critical minerals. This means that they are very likely to come under pressure from mining activities. But they may also have more to gain.

These rare minerals are the key to expanding renewable energy (International Energy Agency)

Why does the government support critical minerals?

Critical minerals include aluminum, cobalt, copper, graphite, lithium, nickel and rare earths.

We need many more of these minerals to expand renewable energy. Critical minerals are also used in defense, space, computing, telecommunications and transportation.

Australia is rich in these resources. Supporting the sector could stabilize global supply and boost the Australian economy.

The A$22.7 billion Future Made in Australia package includes support for “green metals” and $8.8 billion for critical minerals.

Prime Minister Anthony Albanese also promised to accelerate low-risk foreign investment to unlock new projects.

The Albanian government has already announced its support for two major critical minerals projects. This includes $400 million in new loans to Australian company Alpa HPA for a high-purity alumina processing facility in Gladstone, Queensland. It also includes the conditional approval of $185 million to Renascor Resources to accelerate the development of its Siviour Graphite Project in South Australia.

Previous announcements include $840 million in loans and grants for Arafura, a Gina Rinehart-backed rare earths refinery in Western Australia.

The Minerals Council of Australia has welcomed the government’s strategy.

What is the problem?

Extracting more minerals at a faster rate will put some of Australia’s poorest and most remote communities under enormous pressure.

Unless we understand how mining for critical minerals will affect people in these places, the strategy could drive social inequality rather than reduce it. Australia is already fighting inequality. We don’t want to make a bad situation worse.

Our research shows that Australia’s most deprived areas have the highest number of mines and critical mineral deposits.

People in these areas live in smaller communities. They also have lower school completion rates and lower qualification levels than their counterparts in capital cities. These areas are also home to a higher proportion of indigenous people than elsewhere in the same states.

We found 57.8% of critical mineral projects in areas where indigenous peoples have a legally recognized right to negotiate. Including native title claims, these rights are available in 79.2% of these projects.

Following the announcement of Future Made, local communities and territorial councils began to tell us that this new activity increases the pressure around consultations with mining companies. More applications for mineral exploration and mining projects means more community involvement is required. This should include careful consideration of potential risks and impacts. These processes are complex and require time to do well.

State and territory governments have pledged to partner with local communities and First Nations people and share the benefits of critical mineral extraction. But these commitments are not accompanied by any tangible support for research or communities, nor by a clear strategy to avoid negative impacts.

Map of Australia showing the 31 local government areas with the most critical minerals projects in Australia and which are also home to the most indigenous peoples.
The 31 local government areas with the most critical minerals projects in Australia are also home to more Indigenous people.
Burton et al (2024), Resource Policy, CC BY-ND

But doesn’t mining bring local benefits to remote areas?

Mining can create local jobs and business opportunities, but it can also cause harm. Disadvantages include pollution of land and water, loss of biodiversity, destruction of cultural heritage, and liabilities after mines stop producing. Some of these impacts last for generations.

Our data shows that despite the promises made, remote communities and regions do not always see the benefits of mining.

Another challenge is that many of these new mines are expected to be deeper, with lower cut-off grades, which will produce more waste on the surface.

Building complex mines in environmentally fragile or culturally sensitive areas, where people have not benefited from mining in previous decades, will be a huge challenge.

Unless these issues are better recognized and addressed, opposition to mining is likely to increase. If the extraction of critical minerals does not advance, economic gains will be lost and the transition to renewable energy will become more difficult.

These issues must be a central part of Australia’s future critical minerals strategy.

Rear view of a man wearing a high visibility t-shirt pointing over a rock ledge towards a valley.
Jirrbal traditional owner Brad Go-Sam points to the characteristics of northern Queensland’s Silver Valley, a highly prospective area for critical minerals that is being re-evaluated by the Queensland Geological Survey. Used with permission.
John Burton

What can be done?

There is an opportunity to map and better understand the distribution of social and economic risks and potential benefits of mining. Here are three ideas.

First, federal and state governments could commit to spending a minimum of their critical minerals and energy research budgets on independent social science and public policy research. Given the large overlap with indigenous peoples’ lands, this must include First Nations peoples.

Second, as critical mineral deposits are mapped, governments should also explore any overlap with local social and economic issues. In our work, we overlaid critical mineral project data with Australian Bureau of Statistics data on social disadvantage, employment, household income and population characteristics, to highlight issues policymakers and industry need to consider. .

This type of early, preventative analysis, conducted before project approval applications are submitted, would put businesses and communities in a better position. Together you can discuss how to protect local people and the environment and share the benefits equitably.

Third, governments should support researchers to make these studies publicly available and involve local communities, the media and civil society groups to discuss the results. Communities may also have their own questions. This type of open exchange would help level the playing field in deal negotiations and project approval processes, particularly when small communities are faced with multiple projects moving quickly.

Mining is the backbone of the Australian economy. We cannot ignore the social impacts and inequalities in the race to extract more critical minerals.

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