Canada orders Chinese companies to sell lithium assets

OTTAWA, Ontario (AP) — Three Chinese companies have been ordered to sell lithium mining assets in Canada after the country’s government imposed limits on foreign involvement in supplying “critical minerals” used in batteries and high-tech products.

The order Wednesday comes as tensions between the West and China mount over control of sources of lithium, rare earths, cadmium and other minerals used in mobile phones, wind turbines, solar cells, electric cars and other emerging technologies.

Chinese miners are investing in production in Africa, Latin America, Canada and elsewhere as the ruling Communist Party encourages development of electric car, clean energy and other tech industries.

Innovation Minister Francois-Philippe Champagne last week announced curbs on involvement of foreign state-owned companies in producing “critical minerals.” He said investment of any size would be approved only on an “exceptional basis.”

The Chinese government criticized the order as a violation of market principles and called on Canada to reverse its decision.

“Canada stretched the concept of national security and placed barriers to normal investment and trade cooperation between Chinese and Canadian companies,” said a foreign ministry spokesman, Zhao Lijian. “We urge Canada to stop the undue suppression of Chinese companies and instead provide a fair, just and non-discriminatory environment for their operation.”

Western governments want industrial supply chains controlled by allies following Russia’s attack on Ukraine, which disrupted global oil and gas markets, and tension with China, which produces most of the world’s rare earths.

Sinomine (Hong Kong) Rare Metals Resources was ordered to sell its stake in Power Metals Corp., based in Vancouver, which has exploration projects for lithium, cesium and tantalum in northern Ontario.

Chengze Lithium International Ltd. is required to divest its interests in Lithium Chile Inc., a company in Calgary with lithium projects underway in Chile. Zangge Mining Investment was ordered to sell its stake in Ultra Lithium Inc. of Vancouver, which has lithium and gold projects in Canada and Argentina.

Canada welcomes foreign investment but “will act decisively when investments threaten our national security and our critical minerals supply chains,” Champagne said in a statement.

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