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Citing pandemic, GOP lawmakers renew push for action on critical minerals

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Citing pandemic, GOP lawmakers renew push for action on critical minerals

U.S. Republican lawmakers have renewed a push for federal critical minerals policies in light of the coronavirus pandemic, saying President Donald Trump should lift a mineral withdrawal near the Grand Canyon in Arizona, adjust federal oversight of uranium mining pollution and fast-track permitting of mineral refineries as part of future economic recovery plans.

On April 17, a group of 21 House Republicans including House Republican Conference Chair Liz Cheney, R-Wyo., and House Freedom Caucus Chairman Andy Biggs, R-Ariz., wrote to Trump requesting the president "undo" a mineral withdrawal, or land withdrawal, covering more than 1 million acres near the Grand Canyon. The mineral withdrawal, established in 2012 by the Obama administration, clarifies the authorities held by the U.S. Environmental Protection Agency and Nuclear Regulatory Commission over regulating groundwater pollution from in situ leach uranium mining. U.S. uranium producers and their allies raised these issues before the pandemic began as the industry sought regulatory relief after years of cratered uranium prices and unfavorable market dynamics.

The lawmakers also requested the president use existing authorities to bolster domestic mineral refining capacity, including chartering domestic mineral cooperatives or using the Defense Production Act to expedite permitting for refinery construction.

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Republicans privately urged the administration to take these actions more than a week earlier, according to Rep. Paul Gosar, R-Ariz., who led the letter. In an April 20 interview, Gosar said that during an April 9 call with U.S. Interior Secretary David Bernhardt and other Republican lawmakers including Cheney, the administration was urged to act on the Arizona land withdrawal and take additional steps to shore up domestic supplies of critical minerals. "They're very, very receptive," Gosar said of the administration's response. "There are some things that the administration can do."

The pandemic and social distancing efforts have disrupted globalized supply chains for manufacturing everything from medical supplies to batteries. The nuclear power sector appears to lack immunity to these effects as a spike in the price of uranium spurred by mine closures threatens to lock utilities into long-term fuel supply contracts at higher prices.

The Trump administration has long prioritized using regulatory actions to set federal critical minerals policy that insulates the U.S. from potential minerals supply shocks created by events such as trade actions by foreign nations. In May 2018 at Trump's request, the U.S. Geological Survey identified 35 minerals, metals and groups of metals critical to the U.S. economy and military. The U.S. Commerce Department released a report the following year recommending a review of all existing mineral withdrawals to determine the availability of the materials.

Congressional Democrats have questioned the USGS' decision to include uranium on the list of critical minerals, alleging the administration's protectionist policy agenda may be providing cover for actions such as lifting the temporary mining ban in Arizona. The administration's policy priorities related to uranium have recently stalled as the White House focused on the federal response to the coronavirus, though Trump continues to support US$150 million in funding for a national uranium reserve.

Interior Department spokesperson Conner Swanson said in an April 20 email that the administration will take action to ensure "the United States isn't held hostage by foreign powers for natural resources." Swanson said action on the mineral withdrawal near the Grand Canyon is "not an issue under discussion," but the department "remains committed to identifying sources of critical minerals and streamlining the process to expedite production at all levels of the supply chain."

"Now more than ever, the COVID-19 pandemic has made clear the need to increase domestic production of critical minerals used across nearly all sectors of the economy," Swanson said.

Meanwhile, efforts to clarify the EPA's authority over regulating groundwater around in situ leach uranium mines are ongoing and may be close to final. Staff have drafted a memorandum of understanding on parameters for regulatory authority that will be sent to agency leadership for approval, EPA and NRC spokespeople told S&P Global Market Intelligence in April 20 emails.