Australian Treasurer Jim Chalmers has ordered several China-linked investors to dispose of shares in rare earths miner Northern Minerals on national interest grounds under a foreign investment law, a spokesperson said on Monday.

 

Northern Minerals is developing the Browns Range heavy rare earths project in Western Australia, at a time when the sector has become increasingly strategic for its uses in green energy and defence.

 

The mine has been cited as a potential source of feed for Iluka Resources’ Eneabba rare earths refinery under construction in Western Australia, which already has a A$1 billion ($665.10 million) funding from the Australian government and is waiting on a decision for more.

 

Australia has said it is looking for friendly nations to build out its critical minerals industry as the West diversifies away from dominant producer China.

 

A disposal order issued by Chalmers on Sunday said Yuxiao Fund had 60 days to dispose of 80 million shares it bought in September. Yuxiao Fund is the Singapore-registered private investment vehicle of Chinese national Wu Yuxiao, Reuters has previously reported.

 

Northern Minerals has said the fund was controlled by Wu Tao, the chairman of mainland China-based Jinan Yuxiao Group.

 

Yuxiao Fund was restricted by the Australian government from increasing its stake in Northern Minerals in February 2023.

 

Other foreign shareholders ordered to dispose of shares within 60 days include Ximei Liu, Xi Wang, and Black Stone Resources, the notice said.

 

“The Treasurer has issued orders that Yuxiao Fund Pte Ltd and four associates reduce their shareholdings in Northern Minerals,” a spokesperson for Chalmers said in a statement on Monday.

 

“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.” Last week Northern Minerals Chairman Nick Curtis exited the company’s board.

First Published: Jun 03 2024 | 8:48 AM IST