A European Union initiative to secure critical raw materials and bolster supply chains could prove pivotal in rejuvenating Cyprus’ mining sector, according to Cypriot mining company Venus Minerals.
“The Critical Raw Materials Act is an ambitious plan and a huge opportunity for Europe to catch up in the global race for metals and minerals,” Chairman of Cypriot mining company Venus Minerals Mark Rachovides said.
Rachovides’ mention of the Critical Raw Materials Act refers to a recent initiative by the European Union to become more independent and self-reliant in terms of raw materials, thus bolstering the bloc’s resilience to external shocks and disruptive geopolitical events.
The company explained that with global supply chains under immense pressure, concerns have been raised over whether Europe will be able to rapidly shift to renewable energy technologies, like wind turbines and solar panels, which need considerable quantities of raw materials to manufacture.
In addition, it noted that the EU’s industry and economy rely on international markets for access to many important raw materials since they are largely produced and supplied by third countries.
“Although the domestic production of certain critical raw materials exists in the EU, in some cases, it remains dependent on imports from non-EU countries,” Venus Minerals said in a statement.
“The risks associated with the concentration of production are in many cases compounded by low substitution and low recycling rates,” it added.
What is more, the company stated that the effects of the pandemic, especially the disruption of global supply chains, and the subsequent war in Ukraine, have forced Europe to rethink its critical raw material procurement policies with a view to reducing its reliance on third countries and ensuring reliable access to minerals and other components that are essential for the clean energy transition.
In relation to this, European Commission President Ursula von der Leyen announced the EU Critical Raw Materials Act in September 2022
The act is designed to eliminate Europe’s dependencies and secure sustainable access to the necessary raw materials that will enable the bloc to fulfil its ambition of becoming the first climate-neutral continent.
“Lithium and rare earths will soon be more important than oil and gas. Our demand for rare earths alone will increase fivefold by 2030. We must avoid becoming dependent again, as we did with oil and gas,” von der Leyen said at the time.
“We will identify strategic projects all along the supply chain, from extraction to refining, from processing to recycling. And we will build up strategic reserves where supply is at risk. This is why today I am announcing a European Critical Raw Materials Act,” she added.
Moreover, the company noted that the act “will provide a shared understanding of which critical raw materials can be considered as particularly strategic, for Europe’s twin transition and defence needs, including economic importance, supply concentration, strategic applications and forecasted supply gaps”.
This initiative will also define the materials necessary for Green Deal-related technologies, allowing the European Union to have a clearer picture when deciding on strategic projects, which will then be funded through private and public resources.
Crucially, national prerogatives will not be affected by the act, however, member states will likely be obliged to give priority to projects that have officially been designated as strategic.
“As a country where copper is abundant, Cyprus can also benefit since the initiative could help de-risk projects through a dedicated financing vehicle,” Rachovides said.
“The act can also help Cyprus in its efforts to use new technologies to recover important metals from mining waste created decades ago, which would also facilitate the rehabilitation of abandoned mine sites across the island”, he added.
“Clearing historical mining waste can also free land that can be used for recreational and outdoor activities, industrial, or urban redevelopment including commercial activities”, Rachovides concluded.