Federal Government Unveils Canadian Critical Minerals Strategy

In December 2022, the Canadian government released – to much fanfare – its highly anticipated report entitled The Canadian Critical Minerals Strategy – From Exploration to Recycling: Powering the Green and Digital Economy for Canada and the World (herein, the “Strategy”).

The Strategy recognizes that critical minerals represent a generational opportunity for Canada’s workers, economy and net-zero future. Such minerals are the foundation on which our modern economy is built. From electric (zero emission) vehicles to semi-conductors, solar panels and wind turbines, the world needs critical minerals to manufacture those products.

The Strategy aims to boost the production and processing of the country’s 31 identified critical minerals; however, six minerals are prioritized in the Strategy for their distinct potential to spur Canadian economic growth and their necessity as inputs for priority supply chains. These six minerals are: lithium, graphite, nickel, cobalt, copper and rare earth elements.

For a mineral to be deemed “critical,” it must be:

  • essential to Canada’s economic security, and in threatened supply; or
  • required for our national transition to a low-carbon economy; or
  • a sustainable source of highly strategic critical minerals for our partners or allies.

Canada produces more than 60 minerals and metals at 200 mines alongside 6,500 sand, granite and stone quarries. Canada is currently a leading global producer of many critical minerals, including nickel, potash, aluminum and uranium.

In its course to become a global supplier of choice for critical minerals and the clean digital technologies they enable, the federal government has allocated approximately $4 billion towards this in its 2022 budget.


The initiatives outlined in the Strategy will require implementation and refinement in collaboration with provincial, territorial, Indigenous, industry and other Canadian and institutional partners.

The Strategy addresses six core objectives, namely:

  1. driving research, innovation and exploration;
  2. accelerating project development;
  3. building sustainable infrastructure;
  4. advancing reconciliation with Indigenous Peoples;
  5. growing a diverse workforce and prosperous communities; and
  6. strengthening global leadership and security.

The Critical Minerals Centre of Excellence (CMCE) housed at National Resources Canada is leading the development and co-ordination of Canada’s policies and progress on critical minerals, in collaboration with the various stakeholders named above.

In order to develop its listed objectives, the government has earmarked:

  • approximately $79 million for public geoscience and exploration to better identify and assess mineral deposits;
  • a 30 per cent Critical Mineral Exploration Tax Credit for targeted critical minerals. This new tax credit would be available to investors under certain flow-through share agreements. It is applicable to specific critical minerals, including nickel, lithium, cobalt, graphite, copper, rare earth elements, uranium and others;
  • approximately $48 million for targeted upstream critical mineral R&D through Canada’s research labs;
  • approximately $144 million for deployment of technologies and materials to support critical mineral development for upstream and midstream segments of the value chain;
  • approximately $21 million to support the CMCE to develop federal policies on critical minerals and to assist project developers in navigating regulatory processes and federal support measures;
  • $40 million to support other northern regulatory processes in reviewing and permitting critical mineral projects; and
  • $1.5 billion for the Strategic Innovation Fund (SIF) to support critical minerals projects, with prioritization given to advanced manufacturing (such as electric vehicle manufacturing), processing and recycling applications.

The Strategy also summaries the results of the federal government’s Mines to Mobility initiatives launched in 2019 to build a sustainable battery innovation and industrial ecosystem in Canada. To date, the initiative has attracted more than $7 billion in announced investments to capture opportunities in the growing battery market. Some of these investments include GM Canada’s $1-billion investment to transfer its CAMI Ingersoll plant to an EV commercial van plant; Stellantis’ investment of $3.6 billion to retool its Brampton and Windsor plants to produce EVs; and Ford Motor Company investing $1.8 billion to produce EVs in Canada.

Next Steps

The Strategy is intended to be an evergreen document – forward looking, iterative and long-term. Its successful implementation will require a co-ordinated and multi-pronged approach in collaboration with multiple partners and stakeholders.

The following are some of the strategic partnerships and engagement forums that the federal government proposes will help inform implementation of the Strategy over the long-term:

  • Federal-Provincial-Territorial (FPT) Task Team on Critical Minerals and Battery Value Chains;
  • ongoing engagement with Indigenous Peoples via roundtables, workshops and meetings on Indigenous priorities related to critical mineral value chains and other cross-cutting topics (e.g., the National Benefit Sharing Framework);
  • Northern Regulatory Initiative Engagement;
  • regional energy and resource tables;
  • industry critical minerals roundtables;
  • Canada-U.S. Joint Action Plan on Critical Minerals Collaboration;
  • Critical Minerals Working Group under the Canada-Japan Energy Policy Dialogue;
  • Canada-EU Strategic Partnership on Raw Materials;
  • Government of Canada FDI Working Group.

It will remain to be seen, of course, whether the objectives and other goals set forth in the Strategy will be achieved to any meaningful degree. Hopefully, but time will only tell.