Dynamic Reading – Is this the prodigy of today’s AI Report Writing phenomenon? I have been asked to write my thoughts on the latest news about potential rare earths technology bans from China. The first reference I received was written by Shunsuke Tabeta, a staff writer for Nikkei Asia: China weighs export ban for rare-earth magnet tech

The second reference I received was written by Jingyue Hsiao of DIGITIMES Asia, Taipei. This was in response to the Nikkei Asia news: A rare earth war simmers as China reportedly to impose export ban

I then received the preparatory title of a response from one of the InvestorIntel journalists: “What happens next if China bans rare earths technology needed to process rare earths and to make high-performance magnets”.

Lessons from the past

Got me thinking about how people’s reading styles, capabilities, and mental processes appear to be controlling how they understand the reading matter and therefore influence the way they report or comment. Reminded me of a few years back when my granddaughter wasn’t achieving at high school.

I purchased National Geographic subscriptions for us both and commenced a weekly telephone hook-up routine. We took turns investigating each article, with one being the interviewer developing the questions and the other, being the interviewee who had to answer the questions. Who, What, When, Where? With those satisfactorily answered you could then ask the key question: Why? Look at what this does. It focuses the mind to search for factual information BEFORE you look for answers that may be swayed by things such as bias, agendas, or less well-informed previous interactions. It also aids in memory retention.

Unpacking the articles

Look at the Nikkei headline: “export ban”. The DIGITIMES headline reads: “Rare earth war”. The InvestorIntel “What happens next”. These all point to and highlight the differences in the author’s history, experience, and understanding of the topic or their editorial bent.

I thought back and my favorite primary school teacher came to mind. She used these Who, What, When, Where, and Why prompts when I was learning to read. No, not read but understand. So Mrs. long-since-forgotten surname, thank you for your skills. But, I’ll lay claim to the Dynamic Reading title. BTW, it’s about now I’m expecting some hi-tech whiz kid to jump in and say that this tool is similar but opposite to the AI report writers that aggregate multi-article “Who, What, When, Where, and Why” information. Strange place the past!

So I’ll use Dynamic Reading to get to my response to the articles.

What is really being written

Note already the difference in the What. Banning Rare earth magnet technology versus Rare earth elements. So, do I have enough to comment? To provide a Why? Well, not from that information, I need more.

The DIGITIMES Asia article cites Quartz as reporting that China is trying to defend its dominance in rare earths by increasing investments at home and abroad. This position is not supported by the Off-Market Sale of the East China Exploration (ECE) Group of their holdings in Arafura Resources Ltd. (ASX: ARU). Especially since Arafura is well progressed on its Nolans Project development schedule. And then Lynas Rare Earths Ltd. (ASX: LYC) is very well developed on their North American value-adding schedule.

To be honest, I have always had difficulty in developing an overview of how China aggregates and controls the Rare Earth business in China. Although the quotas and technology strategies appear to be working well on paper (their paper), it is not without some resistance from the regions that want more self-governance over their resources. Go no further than looking at the resource development battle between the light rare earths in Baotou, the heavy rare earths in Guangzhou, and the historic separation plants around Nanjing.

My conclusions

My take? Well, I would question: Is the news real or not? Is it part of a grander plan? I am sure that China can see the many developments occurring outside of China. And I am sure that China sees the projected growth in rare earths that are needed and coming from developing towards a Net Zero Carbon future. And I am sure that China must acknowledge that its pre-eminent position is not so much as under threat but that it will lessen as the whole of the world looks to resource development for a global benefit.

So, my feelers are out for more information. Difficult though these days and especially now that TikTok bans are muddying the relationships. Let’s just hope for everyone’s future that China’s People’s Liberation Army (“PLA”) venture into the Straights of Taiwan is not on, or part of, any strategic China agenda.

Oh, my granddaughter? She went from the bottom quartile of her class to be in the top 10%. And is now running her own business. Simply by being taught how to read.

It is my style to attempt to personalize my writings by adding historic anecdotes from my past resources or finding more topical news to add spice to the theme of the day. So last week my mind was searching for the right “insert” to the Environment, Social, and Governance (“ESG”) theme. To my absolute amazement, last week became a very special, somewhat magical week. I was introduced to Watson!

Now by introduced I don’t mean up-front and personal, shaking hands type of first meeting. That would be difficult because a) Watson has paws, and b) Watson lives in Toronto (more than 10,000 miles / 16,000 km away). No, it was an across-the-airwaves type of introduction. Now, I have needed to reference the Canadian Privacy Laws to ascertain what I can and cannot say about Watson and I think what I am about to say is OK. Watson is a dog, owned by a professional colleague of mine. I do not know Watson’s breed, his colouring, or anything really, but I do know he is definitely male. A couple of reasons will soon be revealed.

Watson was taking his owner for a walk through the Toronto snow when he discovered something interesting in a three-foot snow drift. In he went! My recollection of the phone conversation at this point is: “Watson has just dived into a three-foot snow drift and all I can see are his ‘nads!” So, with those two attributes taken as a given, Watson is male! What that has to do with ESG and Critical Minerals is coming up.

The silence of ASX-listed critical minerals companies on ESG

Now, for those of you who frequently scan my writings to review the updates of the ASX-listed Critical Minerals companies you will have noticed that there are no tables. This is simply because there are no updates!

To date, I have contacted 16 of the 36 Rare Earth related companies for nada response. I have contacted 13 of the 60 Lithium companies. And again, thanks Ian Bucknell of Ioneer Ltd. for your reply. And again it is well worth taking the time to review their “Towards Sustainable Mining” work. That’s 1. Plus 14 of the 19 Vanadium companies and 13 of the 28 Cobalt companies. So, I am 56 reach outs and only 1 reply. What does this have to do with Watson?

Well, I am hoping that the ASX-listed Critical Minerals companies would respond to general queries on their ESG programs and progress. Guess not yet! And be careful of our North American friends who may be thinking things about Aussies. I have yet to receive a proactive North American Critical Minerals company pounding at my door to tell the story of their ESG prowess! Back to Watson. So instead of writing about the ESG performances, I guess I’ll have to talk about why I have no responses. This is where Watson fits in. Watson realized there was something valuable in that snow drift and in chasing it he went. He was prepared to leave his ‘nads exposed. That’s how I am feeling now. Not that exposed, but in looking at why people haven’t responded, I may upset someone. Is it worth postulating? Here goes!

It was suggested that all of my queries have been captured by Spam-ware and have disappeared before being given any serious consideration. But you would have thought that references to the Critical Minerals Institute and InvestorIntel would have piqued some interest?

Is it me or you?

Then I thought that maybe it was me! However, I don’t think I know enough people in the space for that possibility to be real. Although, I have presented at many conferences, seminars, and the like, and my presentation style can sometimes be seen as a little non-conventional, but I don’t think that was the reason.

No. I am sure it is the company’s approach to ESG that is preventing public disclosure other than what is necessary in ASX rules and then only available on websites. Why? Can it be our (Aussie) tall poppy syndrome, where if you raise your head someone will shoot it off? Makes some sense not to be seen as an early target for the woke ESG warriors. However, as I raised in the last article, by not being proactive, you run the risk, no, you have already lost control of the agenda. Remember the superannuation funds asking for “disclosure of time-bound climate transition plans”. Still makes me cringe! As I clarified:

1. You have to have a climate transition plan,
2. That plan is time-bound, and
3. The plan has to be disclosed.

And heaven forbid if this Investor Group (and its lobby groups) isn’t satisfied with the details in the plan. It gets worse.

Now for my ultimate Watson. I am going to put myself into the position of a CEO of a Critical Minerals company looking to raise funds but having to face the woke ESG brigade. How do you relate to the audience that the technology you are using is state of the art, best in class, minimizes power usage, presents products into the world of renewables, BUT, does not achieve anywhere near net zero carbon? I’ll leave you with that question and trust when it is your turn to present, your audience appreciates your Watson moment!

The article below provides some insight into the questions raised in the Sustainability Program at PDAC 2023 and the price of “losing control” of a company’s Environmental, Social, and Governance (“ESG”) agenda as well as continues my series (now on part 4) on contacting Australian Stock Exchange-listed Critical Minerals companies to get their views on ESG.

ESG and Critical Minerals Development – The Price of Lost Control

I was wondering how to answer a key question proffered in the Sustainability Program from PDAC 2023:

• How do you “Differentiate your company and attract investment through ESG performance and reporting?”

This is all around my previous concerns about losing control of the agenda by not being proactive with ESG; not being bold with ESG; others have taken control. This is pointedly identified in an article by Geoff Chambers, Chief Political Correspondent and Simon Benson, Political Editor in The Australian newspaper, Tuesday, March 7th, 2023. “Investor Groups seek certainty on Labor safeguard mechanism”. This is about an aggregation of some of the largest superannuation funds in Australia banding together to dictate woke ESG policy direction. Talk about lost control. This is the price of lost control. What that will eventually cost, I’ll try to discuss later, but to the point.

“Australian investor groups representing members with $US43 trillion in assets under management want the government to bolster the safeguard mechanism and avoid “greenwashing” by forcing heavy emitters to disclose time-bound climate transition plans.”

I want you to think about “disclosure of time-bound climate transition plans”. Made me cringe!

1. You have to have a climate transition plan,
2. That plan is time-bound, and
3. The plan has to be disclosed.

And heaven forbid if this Investor Group (and its lobby groups) isn’t satisfied with the details in the plan. It gets worse.

“Where technology is not yet available, carbon credits will play a vital role in helping facilities meet their obligations and remain competitive,…”

The cost of this lost control of the ESG agenda? I find it impossible to predict the timing of when the whole Net Zero process falls apart and we wake up to some sort of new, post-climate apocalypse awakening, new-normal. But it will. But in the meantime, you have to be ready to “disclose time-bound climate transition plans” that are acceptable to the Investor Group. Sounds impossible? Does to me. That means your finance has dried up. That’s the cost of losing control. How long? Well, that depends.

Achieving Operational Net Zero

So, you and I know that you cannot achieve net zero in your operations. You and I also know that you thought you only have two options going forward. One is to plug the gap by buying carbon credits. The other is to hope this whole movement will come to a true sense of realization and fall apart. Any thoughts on how you are going to include “not yet available technology” in your plan? There are also politicians who don’t want carbon credits allowed since “real” emissions reduction isn’t occurring.

You have to ask yourselves the question: “Am I prepared to regain control of the agenda?” If your answer is yes, then go back through my articles where I have told you what to do to demonstrate your ESG credentials. And if you need a good operating example, look at Ioneer Ltd posted in Article 3 of this series. You need to get going. How much time (and hence money) do you have? Well, until the key part of the Net Zero program fails and its failure is seen as a death knell to the 2050 target. What is the key part?

The HR Dilemma

Human Resources. The western world will come to a point where it will realize that it has taken 2 generations to completely overwhelm our education system with anti-STEM, pro-end of the world cataclysmic theories where fossil fuels are bad, development is bad, the future of the planet is at risk. OK, we have a self-induced climate change awareness revolution. But see the irony here? Who is going to fix it? Where is STEM? By creating the environment for the outrage around climate change we have decimated the education system that is needed to provide the resources required to fix it.

The following article by Simon Packham, Foreign Affairs and Defence Correspondent, again from The Australian newspaper, Tuesday, March 6th, 2023. “Submarines ‘need 108 Ph.D. level nuclear scientists per year’”. Not sure if this situation rings true in the US, but it should certainly be ringing alarm bells for those people who think that developing approximately 10 times our current world outputs for rare earths, lithium, vanadium, cobalt, copper, etc is a simple walk in the park. Where are the Human Resources coming from? So, the answer to when is the announcement that the Net Zero program failed is the timeline of acceptance of the Human Resources issue.

Oh, the Price of the Lost Control? Your unrealized profits during this period. And more, much more.

ESG and ASX-listed Cobalt Companies

The process of contacting key Australian Stock Exchange-listed Critical Minerals companies to get their views on ESG has continued this week. The table below for Cobalt will complete the first round of contacting key players. Future articles will hopefully cover the responses coming in, and possibly then contacting some of the lesser players. We will see how that goes. Previous articles 1-3 provide context for anyone who has missed that.

I have updated the Rare Earths reference table and am still to receive any responses. (See Appendix A: ESG in Rare Earths development)

I have updated the Lithium reference table to include the response of Ian Bucknell of Ioneer Ltd. (Thanks Ian.) (See Appendix B: ESG in Lithium development.)

I totally recommend people interested in ESG to read the Ioneer 2022 Sustainability and ESG Report. Their approach using the Towards Sustainable Mining (TSM) framework is first class and looks to have today’s ESG needs well covered.

I have updated the Vanadium reference table and have received no responses to date. See Appendix C: ESG in Vanadium development)

Below is the Cobalt reference table. In the next issue, we will allow access to the tables via links and similarly with the ESG responses from the queried companies.

Cobalt Companies

Appendix A: ESG in Rare Earths Development

Appendix B: ESG in Lithium Development

Appendix C: ESG in Vanadium Development

With the Prospectors & Developers Association of Canada (“PDAC”) convention back in Toronto, Canada, I’ll discuss the four days Sustainability Sessions agenda as I view Environmental, Social, and Governance (“ESG”). I’ll include these comments in each weekly update of my “ESG and Critical Minerals Development” series. See after the Vanadium table.

The process of contacting key Australian Stock Exchange-listed Critical Minerals companies to get their views on ESG continued this week. I am looking to assuage the concerns of some of our stakeholders as to the ESG credentials of those Australia-based organizations that are in a position to supply and add value to the Critical Minerals shortage the world is now facing. The questions are not designed as a platform for investment decisions, but as an important step towards letting you know what their values are, what their achievements have been, and where they see our industry heading. The reference table will include the company name, the ASX Ticker code, their website reference, their current Market Capitalization, and their response to the ESG questionnaire.

The reference table will include all of the Australia-based companies that qualify for the Australian Critical Minerals Strategy.

The questions were:

1. A brief description of your activities
2. How do you define ESG?
3. What should stakeholders be aware of in your approach to ESG?
4. How do you see ESG becoming an important function in the future?
5. Do you have any ESG lessons learned that you may wish to share?

I have updated the Rare Earths reference table and am still to receive any responses. (See Appendix A: ESG in Rare Earths development)

I have updated the Lithium reference table to include the response of Ian Bucknell of Ioneer Ltd. (Thanks Ian.) (See Appendix B: ESG in Lithium development.)

I recommend for people interested in ESG, they should read the Ioneer 2022 Sustainability and ESG Report. Their approach using the Towards Sustainable Mining (TSM) framework is first class and looks to have today’s ESG needs well covered.

Below is the Vanadium reference table. In the next issue will be the Cobalt table. Each issue will allow access to the tables via links and similarly with the ESG responses from the queried companies.

Again, as an aside, if I was responsible for responding to the above query, I would also publish that response to the ASX and include it on the website for an ongoing reference.

PDAC 2023 – The World’s Premier Mineral Exploration & Mining Convention

Sustainability Program

“The Sustainability Program aims to facilitate multi-stakeholder dialogue and peer-learning on key issues related to responsible exploration and mining.”

“The Sustainability Program features presentations and dialogue that examine the innovative ways in which mineral exploration and mining companies are working to improve their sustainability performance, presenting challenges and successes, as well as lessons learned. Topics discussed at the Sustainability Program are both current and critical to the continued improvement of the performance in the industry.”

Sunday, March 5, 2023

• Operationalizing the “S” in ESG: Does it matter to investors?
• Negotiating agreements in early exploration: Best practice MOU’s and EA’s

Monday, March 6, 2023

• Differentiate your company and attract investment through ESG performance and reporting
• Leveraging agreements for Indigenous economic inclusion: Practical implementation
• The amazing race to decarbonize
• Is the future nuclear? Community and industry perspectives

Tuesday, March 7, 2023

• Planning for sustainable mineral development 101
• Navigation complex waters: Tools for security, conflict and human rights
• Changing global rules? The impact of EU’s raw materials strategy

Wednesday, March 8, 2023

• Addressing sexual harassment: Exploring obligations, risks and solutions in Canadian mining

Looking at the articles to be presented they can also be considered as sub-sets of the 5 questions that I have forwarded to the ASX listed Critical Mineral companies. I would be very interested if any of you attend PDAC 2023 and are part of the Sustainability Program. Could you comment as to their articles and the appropriateness and coverage of my questions?

ESG and Critical Mineral Development

Question 2: How do you define ESG?

I want to get something off my chest that has been brewing for the last few years. I am so disappointed in our Corporate world. They have lost control of the ESG agenda. Instead of leading, they have stayed mute and allowed the left-wing woke brigade to establish their agenda. Let me explain.

In my career building management systems in the resources industry, I used a term called SEQ management. That was Safety, Environment, and Quality. Done properly, it totally covered the now ESG agenda, but with a key difference. And what is the difference, you may ask? Simple. We were in control of the agenda. You see, I see ESG (then SEQ) not as your social license, since that is undefinable, but as your social credentials.

Environmentally, you certify your systems to the ISO standard. In Safety and Health, again the ISO standards are available. The Quality systems look after your production processes. Supported by improvement groups working on the key issues, you are set up to handle any issue that may arise. Or that you may want to stay in front of. You are in control. But you may say that the new issues such as climate change, inclusion, or equality are not covered. Well, they are. Climate change is controlled by having the lowest power consumption in your industry group. You may wish to include CO₂ emissions equivalent if you wish, and it makes economic sense to do that. Inclusion can be treated under your health management systems and processes. Equality can be dealt with similarly.

Had the Corporate world been in front of SEQ then the ESG wave would have stayed a ripple, instead of a tsunami, as some folks see it. And you would be in front of it, instead of seeing it reactively as a challenge. Still, it’s with us now. Get in front and be public about your results. Have a read of the Ioneer report referenced earlier. It can be done.

Appendix A: ESG in Rare Earths development

Appendix B: ESG in Lithium development

The process of contacting key Australian Stock Exchange-listed Critical Minerals companies to get their views on ESG continued this week. I am looking to assuage the concerns of some of our stakeholders as to the ESG credentials of those Australia-based organizations that are in a position to supply and value add to the Critical Minerals shortage the world is now facing.

The questions are not designed as a platform for investment decisions, but as an important step towards letting you know what their values are, what their achievements have been, and where they see our industry heading. The reference table will include the company name, the ASX Ticker code, their website reference, their current Market Capitalisation, and their response to the ESG questionnaire.

The reference table will include all of the Australia-based companies that qualify for the Australian Critical Minerals Strategy referenced below.

2022 Critical Minerals Strategy

The survey questions were:

1. A brief description of your activities
2. How do you define ESG?
3. What should stakeholders be aware of in your approach to ESG?
4. How do you see ESG becoming an important function in the future?
5. Do you have any ESG lessons learned that you may wish to share?

I have updated the Rare Earths reference table but have received no responses as yet. (See Appendix A: Rare Earths Table.)

Below is the Lithium reference table. In the next issue, we will add the Vanadium table, followed by the Cobalt table. Each issue will allow access to the tables via links and similarly with the ESG responses from the queried companies.

Lithium Company Table

As an aside, if I was responsible for responding to the above query, I would also publish that response to the ASX and include it on the website for an ongoing reference.

Appendix A: Rare Earths Table

That’s right. Your country needs you! Because it is every one of you (us) that needs to contribute to the goal of Net Zero Carbon if there is to be any chance of reaching the goal. Note here that it doesn’t really matter if you believe (or I believe) that the goal is attainable. What does matter is that if the goal is to be reached then the discussion below is how it can be achieved.

Since this is Article 6 in my series and I am expecting it to be the last, I wanted to do something catchy, hence Uncle Sam. But what I really want to highlight is almost the name of the next James Bond or Mission Impossible film – “The Constancy of Purpose”. The most important aspect of the whole approach. I’ll get back to that.

So, your mission, should you choose to accept, is to be part of the solutions that need to be achieved for the goal of Net Zero Carbon to be attained. This message will not self-destruct after 30 seconds, so you don’t have to hurry. You can re-read before you commit. And when I say to be part of, I mean actively engaged. It’s your part of “The Constancy of Purpose”.

1. Nuclear power. Any new additional power requirements of any size are to be provided by nuclear power. Any replacement power following a fossil-fuelled power station shutting down must be provided by nuclear power. Why? As previously demonstrated there will simply be not enough Critical Minerals developed to supply our power needs from the renewables sector. There will also not be enough STEM graduates to fulfill the resources required. So, you have to be actively engaged in the development or expansion of the nuclear power solution.
2. Solar power. You have to accept that large scale remotely located solar power is a waste of the limited resources highlighted. There is not enough lithium to make enough solar panels. The need to co-develop long transmission systems and battery back-ups is an inefficient use of resources. Rooftop solar is fine as it fits into existing infrastructure, but a solar farm in the center of Australia with 1,000 kms of new high voltage power lines. Methinks not. And using the power to produce hydrogen! Well, let’s get it straight. No government subsidies are allowed anywhere in this discussion. If it isn’t self-sufficient economically, it isn’t a solution. It’s part of the problem.
3. Wind power. Another huge waste of limited resources for the same reasons as above. Magnets are better utilized elsewhere. End of story.
4. Electric cars. The symbol of inner city wokeism. I’ll only browse here. Just imagine the upgrade to your district’s electricity network needed to charge even 20% of electric cars. Just imagine who is going to pay for the upgrade of the apartment block’s electrical system to accommodate a significant increase in demand. Many thousands of dollars per apartment! Is it an efficient use of resources to span our countries with additional electricity transmission infrastructure? Resources are short remember! So, stick to your guns (oops, cars). OK. I’ll let you have a hybrid!
5. Human Resources. Once we have the issues above well planned and in train, we can then define the STEM needs to achieve the goal. All levels of our education systems need to change. And you have to be part of that. Whether as a parent or grandparent, or maybe just a concerned voter influencing our governments, we have to fix this. You have to encourage your children, you have to lobby the governments. The volume of STEM graduates needs to dramatically expand and be focussed. “The Constancy of Purpose” again.

Now sure, everyone has their part to play, but tokenism is not healthy. As reported in The Australian Newspaper, Sunday, February 12, 2023, by Robyn Ironside, is having the “greenest” airline really that important? When the solution requires orders of magnitude more production of “sustainable”, but still carbon dioxide emitting fuel at increased costs?

These “solutions” are wokeisms in play. Change the definition of sustainability and it becomes OK. Well, that is not acceptable. Net Zero Carbon is a real goal and is not to be fudged. I get pretty enraged when I read that EU power stations are burning purposely grown “wood waste” instead of coal and claiming zero carbon emissions. This is fixing the books, not fixing the problem.

“The Constancy of Purpose”

“The Constancy of Purpose”. Who does this apply to? Well, if the world is going to achieve the Net Zero goal, well then, the world needs to have “The Constancy of Purpose”. LOL sorry, couldn’t help it. The developed world and the developing world are streets apart here. Only the developed world is chasing the goal. The developed world wants the developing world to also chase the Net Zero goal. But how can they? In a resource-constrained world, do you really think that the developed world will allow those limited resources to be deployed in developing countries?

Maybe they should if the overall balance to Net Zero indicates that is the most resource-effective answer. Methinks not going to happen. Our political classes are too focused on their own political survival (and ideological orientation) to let valuable resources out of their grasp. That got me thinking about how to determine resource utilization effectiveness on a global scale. Another time, another series. But it will come to that distribution question. Why? Because there will come a time when the developing countries will see that they are being starved of resources by the developed world to attempt to meet their own Net Zero goals. And sorry developing world, you can’t have any! Not a pleasant thought.

So, what chance Net Zero? An article from The Australian newspaper, also on Sunday, February 12, 2023, by well-acknowledged editor, Greg Sheridan, seems to present the argument that is most often proffered.

Net Zero Carbon?

Again. Very negative. My views on Net Zero Carbon? The Critical Minerals developments needed can be addressed. Will take a major shift in Government approvals timing though. The choice of power technology to be nuclear focussed is again achievable but will take some guts from some governments. The Human Resources issue is again achievable, but it would mean the end of the woke revolution in our education system. Achievable yes, in practice – No!

Net Zero Carbon by 2050 on a global scale? No chance! The emissions from the developing world will continue to grow. They will not have access to the resources needed. Well, how about on a local scale, by Country say? In the US or Australia, or the EU? “The Constancy of Purpose” test gives me no confidence. Twenty-five years of focussed efforts to achieve a goal that not even a majority of the population understands, acknowledges, or prioritizes? Methinks not.

We will just have to advance at a pace that results from ignoring the requirements that could move toward the answers. No wonder the Cheshire Cat has such a wide grin!

However, if you still want to do your bit in the Net Zero challenge, remember. “The Constancy of Purpose” may be coming to a theatre near you. So, thanks to movie-world for the license and to Forrest for the end quote: “Well, that’s all I have to say about that.”

As I mentioned in a previous article, I am contacting key Australian Stock Exchange-listed Critical Minerals companies to get their views on Environmental, Social, and (corporate) Governance (“ESG”). I am looking to assuage the concerns of some of our stakeholders as to the ESG credentials of those Australia-based organizations that are in a position to supply and value add to the Critical Minerals shortage the world is now facing.

The questions are not designed as a platform for investment decisions, but as an important step toward letting investors know what their values are, what their achievements have been, and where do they see our industry heading.

The reference table will include the company name, the ASX Ticker code, their website reference, their current Market Capitalization, and their response to the ESG questionnaire.

The reference table will include all of the Australia-based companies that qualify as part of the Australian Critical Minerals Strategy referenced below.

2022 Critical Minerals Strategy

The survey questions were:

1. A brief description of your activities
2. How do you define ESG?
3. What should stakeholders be aware of in your approach to ESG?
4. How do you see ESG becoming an important function in the future?
5. Do you have any ESG lessons learned that you may wish to share?

I will update the reference tables regularly and highlight any new responses received. As this is the first time, here is the Rare Earths table. The next issue will be the Lithium table, followed by the Vanadium and Cobalt tables. Each issue will allow access to the tables via links and similarly with the ESG responses from the queried companies.

Note: At the time of publication, there have been no ESG responses to those Rare Earth companies queried.

As an aside, if I was responsible for responding to the above query, I would also publish that response to the ASX and include it on the company’s website for ongoing reference.

This is now Article 5 of the Net Zero Carbon series. In Articles 1 through 4 (“Net Zero Carbon and Other “Planning Dilemmas” starting with Rare Earths — Part 1“, “Net Zero Carbon and other “planning dilemmas” — Part 2“, “An ESG Armageddon, Net Zero Carbon and other “planning dilemmas” — Part 3“, and “Is it an ESG Armageddon or are you The Survivor? — Part 4“), we have progressed the first two planning dilemmas facing a 2050 target of Net Zero Carbon, those being: Physical Resources and ESG Concerns. We now have to deal with Technology, Power Requirements, and Human Resources.

And, as I sit here thinking about the last three planning dilemmas to face and the order in which I will discuss them, I find my mind revolving in a circle. My thoughts keep jumping from one to the other to the other as the linkages become more clear. Perhaps that is it, they are linked. The resolution to the Human Resources planning dilemma depends unequivocally upon which Technology is utilized and which Power Requirement wins out. Follow the thinking. I’m starting with Human Resources.

As I discussed in the articles on Physical Resources, there needs to be an across-the-board explosion of new Critical Minerals developments to meet the source materials needed to achieve any Net Zero Carbon timeline targets (irrespective of the technology and the timeline of 2050) through the renewables route. Never mind the creation of Western capacity to refine the metals, configure the alloys, produce the componentry and install them within manufactured products. Where are the Human Resources going to appear from? In Australia, I look at our Universities churning out non-STEM (Science, Technology, Engineering, Mathematics) graduates and question: Are these the non-STEM people needed to get through the Human Resources dilemma? I think not.

I look at our High Schools and find it impossible to picture these young environmentalists taking up STEM after graduation. I look at our Primary Schools and see what? Kids having days off to attend protest rallies to “Save the Planet”. I see nothing to encourage me that our education systems are geared, gearing up to, or, preparing for the STEM Human Resources challenge that awaits us to achieve the Net Zero goals that everyone seems to desire. Scary huh! Seems to me that THEY will do it! Not me! THEY.

But do not despair. There are examples. The Chinese did it! It took a couple of generations. I’ll come back later to that solution. The West achieved an unimaginable increase in its manufacturing efforts during WWII, so we’ve done it before. JFK also achieved a similar STEM focussed, an unimaginably large project, by putting a man on the moon. BTW would love to read a book on the planning dilemmas involved in developing such a space program. What a valuable reference. Would be a University classic must-read! That is if it was allowed on the syllabus. Can’t offend the Flat Earthers!

So, Physical Resources coupled with ESG Concerns and Human Resources to achieve Net Zero Carbon by 2050? Not to that timeline with renewables only, methinks! Oh, the Chinese solution. Relocate your impoverished poor to government-built accommodation. Educate them to meet the industrial revolution you are creating. Promise lifetime jobs. Could this occur in the US? My answer later.

You are all aware of how China has successfully taken over the industrial world, so I will not re-iterate that history here. But what I will relate to you, is a program I was a minor part of in the mid-’80s. As a large-scale iron ore company, we, like all others, wanted to export more. China was the target, although then, just a minnow!

“Let’s use Western knowledge to help them manufacture stuff out of our iron ore and we can buy that stuff back. Good for us, good for them. So let’s start making cast iron grinding balls in China”.

Result: early failures! Head Office response: “these guys will never succeed”. At the same time, an engineering friend of mine was researching the production of military helicopters. The objective was to pour molten aluminum into a cast for the helicopter frame in a single process with no joints (and no cracks on cooling). Why? Secrecy and flying radar blind. All that space race stuff. But never mind. Despite many attempts, they were not succeeding. I mentioned that the Chinese had been casting life-size bronze elephants with a 5 mm thin skin, meeting the same cooling parameters he was attempting to achieve with his helicopters for the last 1,500 years. The point? The point is that the Chinese knew how to cast. But they had yet to develop the industrialization skills needed to do it at scale. Boy, did they catch up in a hurry.

I have mentioned in articles and comments my exposure to the Chinese industrial technology degree process. This was China’s answer to accelerating STEM graduate numbers. All employees in rare earth value-add factories are University students. They are learning the practical side of the technology while studying the science side. Their tutors/lecturers are their supervisors and managers. And here’s the magic part. Each business has a University certified “Professor-ranked” scientist. He mentors, assesses, and grants qualifications to the employees when they reach the required level of competence. How’s that for setting up your resources for the future. Again, however, I cannot quite see this occurring in the Western world.

So where I am going with this, is simple to say but comprises an immensely challenging set of tasks to do. Unless we totally overhaul our entire school system, educational processes, and universities, we will not be able to deliver enough STEM graduates to do all the things that are needed to create, design, install and operate those technologies that can take us through to Net Zero Carbon by 2050. A short-term answer to part of that issue is Cadetship and Mentoring whichever way we go. All of us old engineers are available (never quite retired) and I’ll be willing to help young graduates develop the skills and experience as we transition to the new wave of STEM-focused education.

There is obviously a significant gap opening up in our capabilities to achieve Net Zero. We have to become resources efficient in all aspects. So we must now look at the technologies we have focussed on to bring us here and perhaps think again.

Remember this is a journey where we think about a target and how to get there. I am working on thoughts about the balances required to achieve our 2050 goal.

Reference: Lewis Carroll. Alice’s Adventures in Wonderland. The scene where Alice meets the Cheshire Cat sitting in the tree at the fork in the road. I’ll paraphrase.

Alice: which way should I go?

Cheshire Cat: depends on what you are looking for

Alice: I don’t know what I’m looking for

Cheshire Cat: well, doesn’t matter which way you go

Well, it does matter if you go the wrong way and deliberately do not look back and review your decisions. I want to go back in time. Back in time to some fork-in-the-road moments and how those decisions changed mankind. I’ll keep it short and simple. I’ll abbreviate!

Firstly, man discovered fire. Probably in a painful way. But saw its value and started cooking meat. The brain grows and intelligence expands. Burning wood was a good decision. It gave mankind the intellectual boost to discover and utilize coal – steam engines and stuff. Industry. Commerce. The discovery of the concentrated energy of coal and its utilization was another good fork in the road call. STEM was in its heyday. The Industrial Revolution allowed our intellect to discover oil and gas. Note here that each transition of one energy form to the next expands our intellect and allows the expansion of mankind’s capability.

It is now that we get into trouble. The decision to go nuclear was the next key fork in the road moment. Some countries went right and others went left. Let’s see where the left fork has taken us. With no nuclear, baseload power is significantly produced from fossil fuels. Sure hydro works, and of late solar and wind are getting a foothold. But go back to the Resources articles. There is not enough Critical Minerals development for this journey to succeed on a world basis. Tax incentives aren’t the answer. Carbon credits aren’t the answer. We need to go back to that key fork in the road and ask that question again. Should we go nuclear and replace fossil fuels? Knowing what we know now (but some refuse to accept) is that solar and wind cannot supply the majority of our base load needs. We are still in transition getting out of fossil fuels (where appropriate) and getting into nuclear. Sure renewables have a part to play but only in a niche way where their use is truly beneficial and economic (another article).

So, if we still want to get to Net Zero Carbon by 2050 we have some serious questions to answer. Some ideologies need to be challenged. And since the resources are limited and geographically dispersed across countries, ideologies, and cultures, my next article where I will provide the roadmap should be compelling reading. Left or right time with the Cheshire Cat!!

By the way, I am approaching the key (by market capitalization) Critical Minerals Australian-based people on the Australian Stock Exchange to present to us their ESG credentials. Critical Minerals covered include those mentioned in the 2022 Critical Minerals Strategy, March 2022 developed by the Australian Government.

The Critical Minerals referenced include Lithium, Rare Earths, Vanadium, and Cobalt.

Hopefully, the Australian companies will provide us with their ESG credentials and this can give them an additional means of communicating their ESG efforts. InvestorIntel publication can then supplement their normal communication processes. An example of which is Arafura Rare Earths Limited (ASX: ARU) Greenhouse Gas Emissions Reduction Pathway published recently to the Australian Stock Exchange.

In the next article, you, yes you, will have some Cheshire Cat opportunities.

Net Zero Carbon – Article 4. A possible way towards meeting an ever-expanding ESG agenda.

Wow. Article 4 is here already and this will finalise my thoughts on how ESG Concerns are going to have an influence on the Net Zero Carbon goals. And as a reminder, this is only two points off the list. Further articles will address the issues of Technology, Power Requirements, and Human Resources.

In my first article, I introduced a planning dilemma that I had been tasked to look into. Mining in a First Nations National Park. Sounds daunting but there are planning/decision steps you can control and others you cannot. This ESG response that follows was part of my solution to that dilemma. It is also a major part of the ESG issues that will be faced as we attempt to advance on a Net Zero Carbon future. It is also my generic model for any resource business.

As we move into an age where accountability looms large, it would seem obvious that our systems, our processes, and our outputs need to be transparent, understandable, and very importantly defensible. You may think of your systems as your legal defence should things go astray or as your curriculum vitae (CV) to attract/impress your stakeholders.

Step 1. International certification of your management systems.

The International Standards Organisation (ISO) is an independent, international organisation with a membership of 167 national Standards bodies. Through its members, it brings together experts to share knowledge and develop voluntary, consensus-based, market relevant International Standards that support innovation and provide solutions to global challenges.

OK. That’s the official words but what is it to us? It’s independent. It’s internationally accepted. It’s certification of your management systems through thorough independent, industry-experienced professionals who audit every relevant aspect of your business. So, your environmental management system can get the ticks (ISO 14000 series). As can your safety and health system (ISO 45000 series). This is where you can address the recent EID (Equality, Inclusion, Diversity) inclusions as a mental health related issue. You can also include your risk management systems (ISO 31000 series). And it will also be wise to include your quality systems (ISO 9000 series) as the internationalisation of the Net Zero Carbon solution progresses. That may seem like a lot of expense (it isn’t if you do it properly). I prefer to define it as the cost of doing business. It’s your instruction manual. It’s the way we do business. It’s also a line of defence should anyone challenge your credentials. I prefer to see it as a starting point to excellence. Remember the First Nations National Park.

Step 2. Becoming a Best-in-Class operation.

Now you may think that ISO certification is a pretty good standard to reach. As it is. And it’s cost effective if you think of it as a type of corporate insurance policy. I use it as the glue of the business. Operation to the Standards, verified by independent audit, is a foundation that maintains the status quo, while capturing any gains your business can attain through commencing the journey to best-in-class. The Standards don’t really help here in the way of further improvement. The Standards encourage a continuous improvement ideal but of themselves do not provide the mechanism to get to a position of excellence. I will introduce a suite of tools which when used properly provide an excellent road map through regulatory compliance, ISO certification and onwards to best-in-class.

I would like to introduce DNV. Det Norske Veritas. (The Norwegian Truth).

DNV are an independent expert in assurance and risk management. Driven by their purpose, to safeguard life, property and the environment, they empower their customers and their stakeholders with facts and reliable insights so that critical decisions can be made with confidence. As a trusted voice for many of the world’s most successful organisations, they use their knowledge to advance safety and performance, set industry benchmarks, and inspire and invent solutions to tackle global transformations. For us, though I would like to reference three of their system development products.

The International Safety Rating System (ISRS).

ISRS consists of 15 key processes, each embedded in a continual improvement loop. Each process contains sub-processes and questions. It is designed as a measuring tool but I have used it in reverse by utilising the questions within the sub-processes to design the steps and activities needed to build the management systems itself. So your progress through regulatory compliance, ISO certification and progress to best-in-class can be planned effectively and rolled out as part of your normal business planning process.

The following is an extract from the DNV website.

An ISRS assessment is a thorough evaluation of these questions and involves interviews with process owners where the questions are scored and commented. The scope of the assessment is entirely flexible determined by the size and complexity of the organisation and the management team’s requirements. Detailed verification is conducted and organisations must be prepared to offer evidence to support their answers. The process scores determine an overall level of performance between one and ten. The results provide a detailed measure of performance and a gap analysis against the organisation’s desired level of performance. This becomes the planning basis for improvement during the next period. ISRS seventh and eight editions are structured with 15 processes embedded in a continuous improvement loop:

1. Leadership
2. Planning and administration
3. Risk evaluation
4. Human resources
5. Compliance assurance
6. Project management
7. Training and competence
8. Communication and promotion
9. Risk control
10. Asset management
11. Contractor management and purchasing
12. Emergency preparedness
13. Learning from events
14. Risk monitoring
15. Results and review

During my early years of developing ESG systems, the ISRS protocol was extensively used around the world and is available today. To expand the ISRS concept, DNV further developed IERS (environmental) and IQRS (quality). I used these protocols to fully integrate ESG into the normal business planning process. And then the benefits can be clearly seen and achieved (My next series of articles: Better business outcomes using ESG principles).

Step 3. Communicating with stakeholders

Having developed your systems and implementing best-in-class processes, you want a return. This clearly comes by effective communications with your stakeholders. Everyone should know about your efforts and achievements. How else do you think you will be trusted/selected to do that First Nations National Park project? How else do you think the Critical Minerals developments necessary to attempt to reach Net Zero Carbon will continue to get effective and expeditious approvals from the regulatory bodies? How can you provide a response to the eco-challengers that are surely lurking ready to cancel you? And very importantly, how to convince prospective employees that you are the industry that they wish to base their careers around?

Here are some promised references you may wish to peruse to help your thinking on the Net Zero Carbon quest. You may think I am biased towards the negative on this issue. Nothing could be further from the truth. I have sufficient solar power installed such that I require no annualised input from the grid; I am self sufficient in water supply; I am an active recycler and my property has been developed with full ESG aspirations in mind. The fact that I haven’t provided more fact based pro-Net Zero articles is purely to do with, well, they are not available, compared to the numerous pro-nuclear and negatively focused anti Net Zero Carbon debate. I will keep you posted.

The Australian newspaper, January 11^th 2023

Ted O’Brian. Federal Government opposition energy spokesman.

Nuclear Energy? Who better to ask than Japan, whose history is inextricably linked to it.

Comment: Part of the Australian proposed debate on the future of nuclear power.

The Rice Video – CO2 in perspective, Malcolm Roberts. The Galileo Movement.

One Australian view of the issue of anthropological climate change.

Comment: A little old, but the numbers used are factual.

Till next article, stay safe.

ESG Concerns – The Warning!

Well, I thought I had this article on “ESG Concerns” well planned out in my head. Hmmm. That was until I read an InvestorIntel article comment that predicted that the journey that the US was about to embark on to resolve the critical minerals supply shortage was going to bring on a version of environmental Armageddon the likes of which the world had never seen before. Well, the Western World anyway. Gobsmacked, non-plussed, astounded, the comment will not get out of my head. I wanted to write this piece on ESG in a balanced, unbiased, and impartial way but sorry. The only way to get your thoughts out of my head is to, well, just tell it like it is. And I do not care if you disagree with me. I have had 50 years in this space, so I should know my stuff. Here goes.

For starters, I want you to ask yourselves, what is ESG? How would you define it? I have asked many professional people this question and have received many different answers, although, seem to share a common link. The link being “your social license to operate”. Well, that’s about as useful as an ashtray on a motorbike. Social Licence? Where do you get one? The Tax Office? The Department of Justice? Let me give you a hint. There is no such thing as a Social License. It’s a misnomer. You can’t get one. But wait a minute, you are sure in trouble if you lose it.

So, what then is ESG? It’s a term that implies that it is a measure of your environmental, social, and governance performance. How do you measure that? I’ll get back later with my experience. But first, I want to paint a picture of how you lose it. I want to introduce a concept very much related to risk management. Outrage! Remember this term. It is the major factor that can shut down a business. If you think I am wrong, think about Black Lives Matter – classic Outrage. #MeToo – classic Outrage. Cancel Culture – classic outrage. All starting from sometimes apparently innocuous events. Now think about the masses of eco-warriors out there waiting for the opportunity to shut down fossil fuels, waiting for any negative ESG related type event, no matter how small, especially if on US soil. If you think I’m not serious about outrage, that is what has stopped coal seam methane extraction across most of Australia. I know. I was on the receiving end. And once it starts, it accelerates like a snowball down a hill. You cannot stop it. So, what are our critical minerals people going to do about outrage? Easy. Don’t light the fuse! Easier said than done.

Back to the ESG Armageddon theory. I can only assume that such twisted views stem from the reports of Chinese developments of critical minerals and downstream value-adding processes causing massive pollution. Reports, by the way, I have seen from in-country experience, that are vastly exaggerated. Sure, their performance hasn’t been exemplary, but let’s not call the kettle black. We do have a history of our own. The present day ESG standards of the US, Australia, the Western World really are top notch and why some folks think that this will disastrously change as we expand our critical minerals industries has me, well, gobsmacked, non-plussed and astounded! But that doesn’t help our cause when the eco-warriors are waiting. What should we do? Where do we go from here?

An anecdote. The now passed Technical Director of English China Clays was asked that very question in relation to a project that had been in difficulties. Where do we go from here? Jim Gwilliam was his name and he answered by telling the story of a recent driving holiday in rural Ireland. It was night, dark, and they were lost! But they saw lights in the distance and headed towards them. It was a quaint, little Irish pub. Jim and his wife entered and he asked: “How do we get to there?” The barkeep was quite direct in his response. “If you want to get to there, it’s best not to start from here!” That’s your ESG social license in a nutshell. Don’t get yourself in the position of losing it! Start now! Aim to do whatever you need to do to keep it.

OK. I promised you my views.

If you can’t measure it, you can’t control it (or manage). How do you measure your ESG performance? Well for starters, don’t wait for the regulator. They only issue speeding fines. Not the best way to keep the eco-warriors at bay! Well, you do have the mining regulations, the rule book, as a reference, but that’s only a minimum acceptable standard. And that’s only for the E and the S that relates to Safety. The G is covered in statutory business/accounting/stock market requirements. But and a big but, is how do you deal with the honesty, the transparency, and the use of this information to let the S-holders know the real truth.

Update. The ”Battle of the ESG Titans” (*hosted by the Critical Minerals Institute) brought into thinking the EID (Equality, Inclusion, Diversity) discussion. I think this is the new issue that is being brought to the fore as the ammunition that could be used to negate the development of new resources. Really! Why is equality important when you are underground driving a mud truck? Who cares if you are male, or female? Does it make a difference? Does it really matter if you employ more or less locals? Well, the answer is yes to all questions. But only when your community says it matters. That is why you can be racist and employ predominately local for example. The bigger question is who is your community and how much influence are you going to allow them to bring to bear on you? Again, the answer is whoever wants to. I am seething here saying that the social media universe that has enveloped us, stifled us, set us free, keeps us together whilst alienating us whenever it chooses, is a huge ESG issue. No, it’s THE ESG issue that we have to manage. Remember Outrage. A negative E can result in Outrage if the social media wants it. A negative S can, just as a negative G can. Outrage is the No 1 enemy and you cannot fight it. But you can prevent it from happening to you. Stay tuned.

As I progress through this series of articles relating to the Net Zero Carbon dilemma, I will research and publish links to the various online articles that I find on the issue. Some will be positive detailing how we can try to achieve the goal and some maybe negative. You can decide on whether the article influences your thinking.

Article: How much energy will the world need?

Mark Mills, Senior Fellow, Manhattan Institute

My Comment: For those wishing to visualise the resources requirements into the future.

Website: Carbon Engineering Ltd.

Carbon Engineering Ltd. is a Canadian-based clean energy company focusing on the commercialisation of Direct Air Capture (DAC) technology that captures carbon dioxide (CO2) directly from the atmosphere. To access this video, click here

My Comment: Looks like technology that will depend on the key costs of energy, hydrogen and the rationale around carbon credits/cost. I’ll keep an eye.

So, see you next article where I’ll try to keep you away from the Outrage. Well, at least minimise the probability of you being in the firing line.