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China-linked shareholders in one of Australia’s most strategically vital rare earths companies have so far ignored Treasurer Jim Chalmers’ latest order to sell their stakes, casting doubt over the future of a potential supplier of critical minerals to the defence industry.
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The disregard to Chalmers’ edict shown by six investors in Northern Minerals – who combined own 1.7 billion shares, or 17.6 per cent of the company – extends a three-year arm wrestle with the federal government.
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Treasurer Chalmers has twice ordered multiple Chinese companies and individuals to divest their shares, citing national security grounds.
Beijing stands accused of engaging in foreign interference in its bid to control – or stifle – development of a mine in ... Australia that promises to break China’s stranglehold on critical minerals crucial to hi-tech defence.
For more than three years, the federal government has been wrestling to rid Chinese investors from Northern Minerals, a Perth-based company that owns a mine at Browns Range in WA’s East Kimberley, near the Northern Territory border.
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Brown’s Range is rich in terbium and dysprosium, heavy metal rare earths used in high-temperature magnets, ballistic missiles, nuclear-powered submarines and fighter jets, as well as electric vehicle motors and wind turbines.
China has invested heavily in critical minerals processing over the past 20 years and has a near monopoly on world supply.
Northern Minerals is considered strategically vital as potentially the largest non-China heavy rare earths.
Treasurer Jim Chalmers has twice ordered multiple Chinese companies and individuals to divest their shares in the WA company, citing national security grounds.
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One of the companies instead transferred the shares to its sole director and shareholder, triggering a wider investigation by the Foreign Investment Review Board into Northern Minerals’ share registry.
Robert Monterosso, a research fellow at the United States Studies Centre with an expertise in critical minerals, said the share activity was “certainly foreign interference”.
“These are shadowy Chinese firms that are often not publicly listed that are buying up shares in an Australian company.
“Their purpose is to gain control of the company through equity and influence board decisions.
“Some of these firms do not have Australia’s best interests at heart.
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“This is China’s playbook for critical minerals and rare earth dominance. They seek to buy up assets overseas, gain control of those assets, and link them into China’s own supply chains.
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Resources Minister Madeleine King said it was vital Australia made the most of its “geological advantage”.
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