NioCorp Developments Ltd. CEO Mark Smith said that more states are likely to follow California's lead in banning the future sale of internal combustion engine vehicles as a means of accelerating demand for electric vehicles (EVs) and addressing climate change.
In an interview with Proactive Investors, Smith noted these and other government actions are also likely to increase demand for the critical minerals needed by EVs and other cleantech applications – including the critical minerals NioCorp plans to produce at its Elk Creek Project in Nebraska, once financing is obtained and the project is in commercial operation.
NioCorp is developing a critical minerals project in southeast Nebraska that will produce niobium, scandium, and titanium. The company is also evaluating the potential to produce several rare earth byproducts from the project.
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"Demand for EVs and hybrids is going to skyrocket as a result," Smith told Stephen Gunnion of Proactive Investors. "Virginia looks like it will follow suit in not allowing the sale of internal combustion engines along the same timeline as California."
Smith also addressed the impact of a new US law tying the federal tax credit for EV purchases to minimum percentages of critical minerals used in the lithium-ion batteries that are made in the US.
"There is no question that this will have an impact on producers of critical minerals in the US," he noted. “It will drive a huge demand for critical and strategic minerals needed to make these EVs, which the government is now incentivizing. It is a huge development for NioCorp."
Smith also said that companies in the auto sector have increased their inquiries to NioCorp in terms of their interest in the critical minerals that NioCorp intends to produce, once the Elk Creek Project is financed and in commercial operation.
"Those conversations have been developing since the beginning of the year and, with the passage of the Inflation Reduction Act, those conversations have accelerated," he said. "It is really a change in our industry."
According to NioCorp, niobium is used to produce specialty alloys as well as high strength, low alloy (HSLA) steel, which is a lighter, stronger steel used in automotive, structural, and pipeline applications.
Scandium is a specialty metal that can be combined with aluminum to make alloys with increased strength and improved corrosion resistance. Scandium is also a critical component of advanced solid oxide fuel cells.
Titanium is used in various lightweight alloys and is a key component of pigments used in paper, paint and plastics and is also used for aerospace applications, armor, and medical implants.
Magnetic rare earths, such as neodymium, praseodymium, terbium, and dysprosium are critical to the making of neodymium-iron-boron (NdFeB) magnets, which are used across a wide variety of defense and civilian applications.
Contact the author at susie@proactiveinvestors.com
