Australian Treasurer Jim Chalmers ordered several China-linked investors to divest from rare earths miner Northern Minerals Ltd (OTCPK: NOURF). As green technologies gain importance, countries are becoming increasingly inclined to safeguard production.
“The decision, based on advice from the Foreign Investment Review Board, is designed to protect our national interest and ensure compliance with our foreign investment framework,” a spokesperson for Chalmers announced on Monday,per Australian Financial Review's report.
Northern Minerals is currently developing the Browns Range project. Located in the far northeast of Western Australia, it is one of the world’s most significant sources of dysprosium and terbium. These minerals are essential for manufacturing high-performance magnets and batteries, playing a critical role in the global transition to renewable energy and advanced technological applications.
The divestment order impacts several entities, including Yuxiao Fund, Black Stone Resources, Indian Ocean International Shipping and Service Co., and individual investors Ms. Ximei Liu and Mr. Xi Wang.
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Yuxiao Fund, controlled by Wu Tao, attempted to increase its stake in Northern Minerals to 19.9% in February 2023. Chalmers blocked this action, citing the need to scrutinize foreign investments more closely. Tao has also campaigned for the removal of Northern Minerals’ executive chairman, Nick Curtis, who stepped down from the board last week.
Still, Tao's plan to join the company's board is now compromised as he and the others must complete the divestment process within 60 days. Meanwhile,Northern Minerals prepares for its annual general meeting on Thursday, June 6. This meeting is expected to provide more clarity on the situation and the future direction of the company.
“National security threats are increasing due to intensifying geopolitical competition. The government is dedicating greater resources and scrutiny to foreign investment proposals in critical and sensitive sectors of the economy in order to consider economic benefits, security risks, and potential mitigations,” Secretary to the Treasury Steven Kennedy said in opening remarks to Australia's Economics Legislation committee on Monday.
"These actions will ensure that Australia can attract the significant foreign investment needed to support its priorities while protecting the national interest in an increasingly complex global environment," he said.
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Photo: Northern Minerals
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