The world’s big mining companies must find a new formula for success. The era of critical minerals has arrived, and it’s the most momentous change the industry has seen in decades. Miners can no longer depend on yesterday’s portfolios and practices to create value in this newly dynamic and fiercely competitive landscape. And mining CEOs seem to know it: of those polled in PwC’s 26th Annual Global CEO Survey, 41% don’t think their companies will be economically viable in ten years if they continue on their current path. The era of critical minerals must therefore be an era of reinvention.

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One shift that demands a response is the emergence of an important new player in the critical minerals market: the government. After seeing rapid demand growth and risky levels of supply chain concentration, governments have formed alliances, instituted new policies and mobilised funding to secure access to critical minerals. These moves will change the mining business. The inflow of public funds, for example, means that miners must rethink the rates of return they can expect on mining or supply chain assets. Miners will also need to contend with heightened investment risk and greater competition as governments alter the playing field with incentives and interventions.

Then there’s the urgent task of decarbonisation. Miners will have to ramp up production to meet rising demand for the critical minerals and other commodities that are required for the energy transition. But they also know they must reduce their carbon emissions. More than one-third of mining CEOs see their company as highly or extremely exposed to climate-related risks. The good news is that decarbonisation can help miners create value at all points along the value chain. More and more, we’re seeing miners boost efficiency with low-carbon technologies and methods, partner with processors to produce the “green metals” that customers increasingly want, and access sustainability-linked financing.

Source: PwC's Mine Report 2023

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