Critical minerals such as lithium, cobalt, and nickel are essential to make the batteries used in electric vehicles and to support other clean energy technologies such as solar panels. Although the transition to clean energy needed to combat climate change will require a robust, diversified, and sustainable supply of critical minerals, a small number of authoritarian governments currently control a substantial portion of the critical mineral processing market, including 80 percent of the global capacity to process and refine cobalt, making these resources especially vulnerable to supply chain bottlenecks and geopolitical risk.

Solution and Impact

A DFC equity investment in TechMet Limited will support the development of a critical mineral mining facility in Piauí, Brazil that will produce nickel and cobalt suitable for lithium-ion batteries. DFC’s investment will also support the development of new technology and designs in processes that will advance more efficient and environmentally sensitive mining practices.

TechMet is a platform that invests in businesses that mine and process metals used in energy, transportation, and related industries and is working to build controlling or dominant minority positions in projects producing critical minerals to diversify the global supply chain. TechMet’s portfolio—including several U.S.-based companies—serves a large group of customers seeking to diversify their supply chains. DFC’s investment is aligned with the U.S. Government’s Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals, designed to help ensure supply of minerals that are vital to U.S. security and economic prosperity.

The mining facility in Brazil is expected to be an important source of formal employment in a rural area with limited income opportunities. Piauí is in one of the least-developed parts of Brazil, and much of the population surrounding the mine relies on subsistence agriculture. The project is expected to create hundreds of new jobs, providing extensive safety and technical training for workers, and generating substantial tax revenue for local municipalities.

With women comprising almost one-third of all employees and one-third of all managers at the mining facility—significantly higher than rates in the global mining workforce—the project also advances DFC’s 2X Women’s Initiative.