Identifying ways to drive US investment in Australia and deepen the critical minerals partnership were the focus of US Energy Resources Assistant Secretary, Ambassador Geoffrey Pyatt’s, recent visit to Perth.
US Energy Resources Assistant Secretary, Ambassador Geoffrey Pyatt.
The Ambassador met with several companies and industry leaders, including CCIWA’s Chief Economist Aaron Morey, along with Liontown Resources and Fortescue.
Ambassador Pyatt says Australia’s critical minerals sector is crucial to the US and the world’s decarbonisation ambitions, driven by the Inflation Reduction Act (IRA).
“If you look at US investments in Australia’s critical minerals sector, we’ve seen AU$2.3 billion of new private sector and government investments here, just since the IRA was passed in the summer of 2020,” he says.
“We are your biggest investors … and that is going to remain the case.”
US investment in Australia has grown from $116b to $185b over the decade to 2021 and accounts for 17.4% of total foreign direct investment in Australia, according to the Australian Bureau of Statistics.
Energy security a priority
The Ambassador’s visit highlighted the priority the US has on global energy security, where it sees Australia, particularly WA, as a key partner in the green energy transition. In fact, energy security is now an important part of the Australian-US bilateral relationship, Ambassador Pyatt says.
“This region and this city punches well above its weight in terms of the global energy security and energy transition supply chain,” he says.
WA companies have a “critical role” in diversifying US supply chains for the energy transition, particularly commodities such as nickel, lithium and rare earths.
“The real measure of our success is delivering energy security, for instance, de-risking our vulnerability to countries that would use their energy assets for malign purposes, led by Russia and China, and identifying opportunities to accelerate the energy transition,” Ambassador Pyatt says.
National security approach needed
Ambassador Pyatt says challenges in global critical minerals markets, mainly lithium and nickel, need to be addressed with a national security approach, rather than an economic one.
“The disruption that’s happening in [lithium and nickel] prices and how that’s interrupting investment plans presents an obstacle to what we know we need to do, which is deliver vastly increased volumes of these materials to meet our energy transition goals,” he says.
“We need to figure out, as my European colleagues put it, how to ensure that an era of European vulnerability to Russian energy coercion is not followed by an era of collective vulnerability to China’s domination of these technology supply chains.”
The Ambassador says this includes making markets more transparent and ramping up volumes of material required for climate targets.
“That means mobilising investment, it means introducing a greater level of transparency, predictability and pricing,” he says.
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