Brazil seeks investment in energy transition
Brazil’s National Development Bank (BNDES) and mining giant Vale on Monday announced a public bidding process to select an investment fund to invest in minerals related to energy transition, decarbonization, and fertilization.
“With the objective of developing new mines, the fund will be an important tool to finance mineral research,” BNDES said in a statement.
Bidding will start on July 1 and end on July 23. The winning proposal will be announced by early October 2024.
BNDESPAR — a BNDES subsidiary which carries out the capitalization of undertakings by private groups — and Vale will commit between BRL 100 and 250 million (USD 19.2 to 48.2 million) to the fund, with each owning a maximum 25 percent stake. Therefore, investors are required to pledge at least BRL 200 million (USD 38 million).
There is no universally accepted definition of critical minerals. According the rules of the bidding process, the fund is to invest in companies with assets in Brazil including “cobalt, copper, tin, graphite, lithium, manganese, platinum group metals (PGMs), molybdenum, niobium, nickel, silicon, tantalum, rare earths, titanium, tungsten, uranium, vanadium, zinc, phosphate, potassium, or other minerals to promote soil fertility, including remineralizers.”
BNDES chair Aloizio Mercadante said in a statement that the new fund ”contributes directly to the strategic objectives” of President Luiz Inácio Lula da Silva’s administration “to expand the productive capacity of the Brazilian industry” in addition to “contributing to the fair ecological transition and decarbonization, and to encourage the capital market to operate in this sector.”
Vale’s CEO Eduardo Bartolomeo said in a statement that the company is “proud to be part of this initiative, which is aligned with our long-term vision on the crucial relevance of critical minerals for global economic growth in a sustainable and diversified way.”
Back in March 2023, Jose W. Fernandez, the U.S. undersecretary for economic growth, energy, and the environment, said that Brazil “can be a critical minerals powerhouse” at a time when the world is “thirsty and hungry” for them.
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