US$ 201 million fund launched for investments in strategic mineral projects for energy transition

The National Bank for Economic and Social Development (BNDES) and the Ministry of Mines and Energy (MME) have launched a BRL 1 billion (US$201 million) fund for investments in strategic mineral projects for the energy transition in Brazil.

The funds are accessible to small and medium-sized enterprises aligned with the investment focus of the fund. The Strategic Minerals Investment in Participations (FIP) is designed to foster the advancement of mineral projects crucial for the energy transition, decarbonization, and sustainable food production. It anticipates investing in 15 to 20 companies engaged in mineral exploration, research, and the establishment of new strategic mineral mines in Brazil. BNDES plans to contribute up to BRL 250 million (US$ 50 million) to the fund, limited to a 25% stake and seeks participation from other national and international investors. The fund's priority minerals include those vital for energy transition and decarbonization, such as cobalt, copper, tin, graphite, lithium, manganese, rare earth ore, platinum group ores, molybdenum, niobium, nickel, silicon, tantalum, titanium, tungsten, uranium, vanadium, and zinc. Additionally, phosphate, potassium, and remineralizers, crucial for soil fertility, are covered by the fund.

This initiative by BNDES aligns with its decade-long support for the mining sector, involving BRL 8.3 billion (US$ 1.6 billion) in financing for approximately 1,800 companies. The Strategic Minerals Fund also seeks to encourage invested companies to adopt exemplary Environmental, Social, and Governance (ESG) practices, fostering positive impacts on local communities and minimizing environmental project impacts.