On Thursday, October 23, the United States government announced the establishment of a new fund in partnership with New York investment firm “Orion Resource Partners” and Abu Dhabi sovereign fund ADQ to jointly invest in critical minerals.
The newly formed “Orion Critical Mineral Consortium” is composed of the United States International Development Finance Corporation (DFC), one of the three largest sovereign investment funds in Abu Dhabi, ADQ, and the U.S. private equity fund “Orion Resource Partners,” each contributing $600 million, with an initial total fund of $1.8 billion. The consortium plans to attract more international funds, expanding the scale to $5 billion.
The fund will be used for mineral extraction and smelting projects globally to strengthen Western countries’ control over key minerals such as lithium and rare earth minerals, reducing dependency on the supply chain from China.
Earlier in September, there were reports that the DFC and “Orion Resource Partners” had been in discussions to establish a joint fund.
The “Orion Critical Mineral Consortium” will focus on mineral projects that are already in production or can quickly begin production to avoid the higher risks associated with exploration stages. Frank Fannon, the managing partner of the consortium, previously served as the Assistant Secretary of State for Energy Resources at the U.S. State Department during President Trump’s first term. He stated that the consortium’s focus is on advancing projects that can begin production in the short term to quickly reintegrate raw materials into the industrial chains of the U.S. and its allies.
Oscar Lewnowski, the founder and CEO of Orion Resource Partners, mentioned the company’s intention to “seek out the source of minerals” and establish mining and smelting facilities globally. He emphasized their dedication to supply chain financing to ensure stable downstream product supply to meet the needs of businesses and consumers.
The investment scope will cover projects related to “critical minerals” listed in the U.S., Canada, European Union, and Australia, including lithium, rare earth metals, copper, and uranium. As the U.S. representative, the DFC will participate in investment decisions to mitigate geopolitical risks in emerging markets. Lewnowski pointed out that “U.S. government participation significantly enhances the feasibility of investments.”
Since returning to the White House in January, the U.S. government has been striving to counter China’s dominant position in the production and processing of metals such as rare earth minerals, copper, aluminum, germanium, and tungsten.
Currently, China still controls the majority of global rare earth and battery metal supplies, and the recent tightening of export policies by the Chinese Communist Party has further increased market uncertainty. In order to reduce risks and ensure supply security, the U.S. and its allies are accelerating the construction of alternative supply chains to weaken dependency on China.
Under the leadership of the Trump administration, the U.S. government has invested in rare earth producer MP Materials and Lithium Americas, demonstrating Washington’s increasing involvement in private mining to secure strategic resource supplies.
Earlier this week, London-based private equity firm Appian Capital Advisory and the International Finance Corporation (IFC) under the World Bank Group announced the establishment of a $1 billion fund to invest in mineral projects in Africa and Latin America, highlighting the ongoing escalation of the global “resource geopolitics.”
(This article referenced reporting from Reuters.)