Canada used the G7 Energy and Environment Ministers’ meeting in Toronto on October 31, 2025, to vault itself to the center of a fast-forming alliance to diversify and secure global critical mineral supply chains. Building on the G7 Critical Minerals Action Plan launched in June 2025 in Kananaskis, Alberta, Ottawa unveiled the first round of 26 investments, partnerships and measures under the Canada-led Critical Minerals Production Alliance. The package aims to unlock $6.4 billion in projects integral to defense, clean energy and advanced manufacturing.
Framed as a counterweight to China’s overwhelming dominance in mining and, especially, refining, the initiative pairs government-backed offtake agreements and financing with multinational partnerships and targeted R&D. It also sets up a political and policy test: whether countries can accelerate “friend-shored” supply chains while addressing mounting concerns over Indigenous rights, environmental harm and social conflict near project sites.
The first tranche of funding is heavily focused on purchase agreements, letters of interest, and conditional financing aimed at mitigating risks associated with construction and commercialization. Notably, Nouveau Monde Graphite has secured offtake arrangements for its Matawinie Mine near Montreal with significant partners, including the Government of Canada, Panasonic from Japan, and Traxys from Luxembourg. The project benefits from substantial backing, including over $35 million from the Canada Growth Fund, a letter of interest from the Canada Infrastructure Bank, and potential support of up to US$430 million from Export Development Canada, complemented by investment commitments from Panasonic Energy and Mitsui & Co. This project is set to establish North America’s largest fully integrated natural graphite operation. In Sorel-Tracy, Quebec, Rio Tinto’s Scandium Production Plant has received a significant equity-like royalty investment of approximately $25 million from the Canada Growth Fund, along with a federal offtake agreement designed to transition the plant from demonstration to full commercial production.
Ucore Rare Metals Inc., located in Kingston, Ontario, has been conditionally approved for funding of up to $36.3 million to support the commercialization of its RapidSX separation technology, aimed at refining samarium and gadolinium. This financial package comprises up to $26.3 million from Natural Resources Canada and an additional $10 million from FedDev Ontario. Ucore has established a memorandum of understanding with end customers Vacuumshmelze in Germany and Permag in the United States, while also securing feedstock arrangements with Hastings and ABx in Australia. Additionally, a technology agreement with Metallium, also in Australia, will facilitate the processing of e-waste and tailings, and Ontario has committed to advancing the necessary regulatory permitting.
Furthermore, Torngat Metals has announced an offtake and technology collaboration for its Strange Lake rare earths project in Quebec with France’s Carester. Meanwhile, Vianode has made progress on its synthetic graphite facility located in St. Thomas, Ontario, by securing a letter of interest for up to US$500 million from Export Development Canada. It also received a letter of interest from the Canada Infrastructure Bank and a German government letter of interest for an export credit guarantee of up to US$300 million. Vianode has already established an offtake deal with General Motors, positioning itself strongly in the industry. Northern Graphite, which stands as the only current producer of natural graphite in North America from its Lac des Iles site near Montreal, signed a letter of intent for offtake and toll processing with Alkeemia from Italy. This agreement will support the deployment of Alkeemia’s purification technology at Northern Graphite’s planned anode facilities in both France and Quebec.
These business developments reflect a broader trend of international cooperation in the sector. UK Export Finance is collaborating with Export Development Canada and Natural Resources Canada to explore financial support for Canadian projects that cater to the UK supply chain. Additionally, Italy’s ENI has expressed interest in Canadian lithium and graphite as well as emerging companies involved in rare earth refining and battery recycling. Furthermore, Canada and Australia have signed a Joint Declaration of Intent on Critical Minerals Cooperation, focusing on project financing, technology development, regulatory alignment, information sharing, and enhancing supply chain resilience.
As part of the G7 plan, Canada has announced significant funding amounting to up to $20.2 million dedicated to collaborative research and development initiatives. One major project involves Focus Graphite, which is receiving up to $14.1 million through the Global Partnerships Initiative. This funding will support a pilot program that seeks to demonstrate a chemical-free, high-temperature purification process for natural flake graphite sourced from the Lac Knife and Lac Tétépisca deposits, in collaboration with Ukraine's TMEC and the American Energy Technologies Company.
Additionally, Northern Graphite and Rain Carbon Canada have secured $860,000 from the National Research Council of Canada’s Canada–Germany program. They aim to upcycle leftover natural graphite for use in high-performance battery anodes. Meanwhile, PH7 Technologies and York University, along with their German partners, have been awarded up to $900,000 via NRC’s “3+2” Canada–Germany program. This funding will be utilized to develop an AI-optimized metallurgical process focused on battery metal recovery and sustainable recycling.
Telescope Innovations Corp. is also part of this initiative, receiving up to $319,200 through NRC’s Industrial Research Assistance Program (IRAP) alongside their UK partner, CellMine. Their project aims to convert spent lithium-ion batteries into battery-grade lithium carbonate and cathode active materials. Moreover, Telescope Innovations is conditionally approved for an additional funding of up to $3.04 million under Natural Resources Canada’s Clean Minerals and Rare Earths Development (CMRDD) program to scale up low-cost lithium sulfide manufacturing, crucial for the development of solid-state batteries.
Furthermore, Excir Works Corp., in collaboration with the Royal Mint UK and WEEE Scotland Ltd., has secured $500,000 through NRC’s IRAP to expand the range of metals they can recover through recycling processes. Lastly, NTwist Inc., working with Vale Europe Ltd. and Tunley Environmental Ltd. from the UK, has also received $500,000 via NRC’s IRAP aimed at enhancing nickel production efficiency. This comprehensive funding strategy underscores Canada's commitment to advancing sustainable technologies within the battery and recycling sectors.
The geopolitical backdrop loomed large. The International Energy Agency estimates China holds an average 70 percent market share for 19 of 20 key minerals and accounts for about 91 percent of global rare earth refining. While Beijing recently agreed with Washington to pause some rare earth export controls for a year, U.S. Energy Secretary Chris Wright argued that the episode underscored the imperative for G7 countries to mine and process more at home and among allies.
Minister of Energy and Natural Resources Tim Hodgson framed the new initiatives as a signal that G7 countries will move “swiftly to reduce dependence on concentrated supply chains,” warning that “every delay is a concession of economic and national security interests.”
CBC News reported that Ottawa is also designating certain critical minerals as a national security priority under the Defense Production Act, enabling the federal government to guarantee a buyer and a minimum price to shield domestic producers from market volatility. Industry groups, including the Mining Association of Canada, publicly welcomed the federal focus on investment and financing tools to accelerate project development.
Two significant projects exemplify the tension surrounding Indigenous rights and environmental concerns in the context of Canada’s critical mineral agenda. The first is Torngat Metals’ Strange Lake rare earths project, which has raised alarms among the Naskapi and Innu Nations. These communities are particularly worried about the impact on caribou habitats, potential contamination linked to uranium, and the preservation of sacred sites. Additionally, residents of Sept-Îles have expressed their opposition to the proposed storage of uranium waste near vital water sources. While the project seeks to extract heavy rare earths essential for renewable technologies, Greenpeace has issued warnings that, in the absence of binding safeguards, materials from this project could be diverted for weapons manufacturing. The ownership structure of the project has intensified the debate, especially given links to Cerberus Capital Management and downstream clients like Vacuumschmelze, a supplier of components for F-35 jets and missiles.
The second project, Nouveau Monde Graphite’s Matawinie Mine, was the focus of a notable blockade in 2021, led by members of the Atikamekw of Manawan First Nation. This event highlighted the growing social tensions as Quebec aims to integrate itself into the electric vehicle battery supply chain.
In the broader context, Peace Brigades International–Canada (PBI-Canada) reminds us that mining continues to be the deadliest sector for land and environmental defenders around the globe, with Global Witness documenting at least 29 killings related to mining activities in 2024 alone. In response to these ongoing challenges, PBI-Canada is actively developing its PBI-Turtle Island initiative, which aims to expand protective measures into Northern regions and has begun outreach efforts with communities directly affected by extractive projects.
Analysts say Canada has successfully used the G7 spotlight to elevate project-level deals, but comprehensive market standards and policy alignment remain unfinished. University of Ottawa professor Wolfgang Alschner called the Toronto announcements “very much project-focused,” with “much policy work” still needed on standards that would govern everything from ESG performance and traceability to cross-border financing.
Canada’s own clean economy ambitions will also demand sustained capital beyond this first wave. The Canadian Climate Institute estimates the country will require roughly $30 billion in capital investments by 2040 to meet domestic demand for minerals tied to decarbonization.
With the next G7 leaders’ summit set for June 14–16, 2026, in Évian-les-Bains, France, the alliance faces a two-fold challenge: locking in bankable projects that diversify supply chains away from chokepoints, while ensuring transparent, rights-respecting development that earns trust in the communities where mines and processing facilities are built. The stakes for climate goals, economic security and human rights are only getting higher.