Focus on funding exploration stage projects.
The European Union and the European Bank for Reconstruction and Development have agreed to invest 100 million euros in critical raw material projects. The capital will be allocated to mineral exploration companies and projects in countries where the EBRD operates and countries covered by the Horizon Europe program. This includes some EU member states but also countries outside the EU, as the EBRD is active in 36 economies. A complete list can be found here.
The two institutions will each provide a quarter of the equity, while the remaining half of the money is expected to be mobilized through a joint facility. The EBRD clarified that it aims to invest in a handful of junior mining companies undertaking critical mineral exploration. The bank added that the equity injection through the institutions is aimed at offsetting the fact that these companies do not yet generate active mining revenue in the exploration and development stage. From the discovery of a mineral deposit until the actual mining stage, multiple years pass, sometimes decades. Only then do companies generate revenue.
A simplified mining life-cycle.
The investment aligns with the goals of the Critical Raw Materials Act, a legislation with which the EU aims to safeguard the supply of critical raw materials. It entered force in May and stipulates, among other things, that member states must ramp up domestic mining, refining, and recycling efforts of critical minerals.
Photo: Tom Fisk via Canva
