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Researched by Industrial Info Resources (Sugar Land, Texas)--The U.S. Treasury Department released the final rules for the Inflation Reduction Act's Advanced Manufacturing Production Credit (AMPC), also known as the 45X tax credit, which now applies to some miners. Following industry pressure, the 45X credit includes the extraction, processing and/or refining of designated critical minerals, although it does not solely apply to mining costs.
"In particular, the final rules will accelerate the buildout of domestic critical mineral supply chains by allowing taxpayers to include materials costs and extraction costs in production costs for applicable critical minerals and electrode active materials, provided certain conditions are met," the Treasury Department said in an October 24 press release. "This change, based on feedback from stakeholders, will enable further investment in responsible U.S. critical minerals extraction and processing and strengthen U.S. energy security and clean energy supply chains."
Among the conditions are:
In addition to a 10% credit for U.S.-made clean energy components, such as those for solar, wind and energy storage, the credit initially applied generally to the production of 50 designated critical minerals. The Treasury Department later provided additional guidance, which excluded the extraction costs from applying, with the final refiner of critical minerals entitled to claim the majority of the credit.
Among the 50 critical minerals open to the 45X credit are aluminum, cobalt, lithium and nickel, as well as platinum group metals (PGMs) such as platinum and palladium.
One of the stakeholders that pushed to change the draft rules is Sibanye-Stillwater Limited (NYSE:SBSW) (South Africa), who filed written submissions to the department during a public comment period.
"The omission of extraction costs from the proposed 45X credit regulations excluded the vast majority of the costs incurred by the U.S. PGM operations from being eligible resulting in little financial benefit or support for the operations," the company said in an October 25 press release following the Treasury Department's latest announcement.
In a press release attributed to U.S. Senator Jon Tester (D-Montana)--who also put pressure on the Treasury Department--Heather McDowell, Sibanye-Stillwater vice president, legal and external affairs, Americas, said, "As the only domestic primary producer of platinum and palladium on scale ... being able to claim a tax credit on our mining and recycling costs is an important step in stabilizing our operations so that we can continue to invest in sustainable critical minerals production for the U.S. market."
Industrial Info is tracking proposed projects from Sibanye-Stillwater at its East Boulder platinum mining and milling operation in Big Timber, Montana. An expansion of the mine, which is designed to wrap up in 2026, would boost the capacity from 580,000 tons per year to 700,000 tons per year; three expansions also are proposed for the tailings storage facility, which currently has enough storage capacity for milling through the end of 2024. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for a full list of proposed projects at the mine.
Alcoa Corporation (NYSE:AA) (Pittsburgh, Pennsylvania) also applauded the final rules. "Section 45X is an important tool for shoring up domestic manufacturing of critical materials, including commercial-grade aluminum from Alcoa's U.S. smelters in Newburgh, Indiana, and Massena, New York," the company said in a press release. "The aluminum produced at these facilities plays a crucial role in multiple domestic manufacturing segments including clean energy, automotive, aerospace and building materials."
Subscribers to the GMI Plant Database can read profiles on the Massena and Newburgh smelters.
Alcoa is exploring the restart and expansion/life extension of its Liberty coal mine in Boonville, Indiana, to provide high-sulfur steam coal to fuel the nearby Newburgh smelter. The project is active and in its permitting phase, but Alcoa announced in March it was delaying the project. Subscribers to the GMI Project Database can click here to read the project report.
However, following the announcement of the final rules, Rich Nolan, president and chief executive officer of the National Mining Association, criticized the treasury's decision to "limit the credit to those producers who also refine materials," noting this will prohibit many important projects from benefiting from the credit. "We have an urgent need to level the playing field for American producers against Chinese and Russian efforts to dominate global mineral supplies by flooding the markets with oversupply of cheap minerals ... by making U.S. processed, foreign sourced materials available for the credit we're not solving the problem. Made-in-America should also mean mined-in-America and the miners who secure the very first link in our supply chains should benefit from the same credits as the entities that refine their materials."
Subscribers to Industrial Info's GMI Project and Plant databases can click here for a full list of detailed reports for projects mentioned in this article, and click here for a full list of related plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
"In particular, the final rules will accelerate the buildout of domestic critical mineral supply chains by allowing taxpayers to include materials costs and extraction costs in production costs for applicable critical minerals and electrode active materials, provided certain conditions are met," the Treasury Department said in an October 24 press release. "This change, based on feedback from stakeholders, will enable further investment in responsible U.S. critical minerals extraction and processing and strengthen U.S. energy security and clean energy supply chains."
Among the conditions are:
- Companies must mine, process and/or refine the minerals in the U.S. to qualify, so the credit does not apply to those that mine but do not process minerals domestically
- However, businesses can claim the credit if mining is done abroad, as long as the processing is done to a certain purity level in the U.S.
- Companies will only receive the credit once they have made an "eligible component," such as the applicable critical minerals
- The processor claiming the credit must have also mined the mineral itself, and a product that has received credit in the past cannot be counted again.
In addition to a 10% credit for U.S.-made clean energy components, such as those for solar, wind and energy storage, the credit initially applied generally to the production of 50 designated critical minerals. The Treasury Department later provided additional guidance, which excluded the extraction costs from applying, with the final refiner of critical minerals entitled to claim the majority of the credit.
Among the 50 critical minerals open to the 45X credit are aluminum, cobalt, lithium and nickel, as well as platinum group metals (PGMs) such as platinum and palladium.
One of the stakeholders that pushed to change the draft rules is Sibanye-Stillwater Limited (NYSE:SBSW) (South Africa), who filed written submissions to the department during a public comment period.
"The omission of extraction costs from the proposed 45X credit regulations excluded the vast majority of the costs incurred by the U.S. PGM operations from being eligible resulting in little financial benefit or support for the operations," the company said in an October 25 press release following the Treasury Department's latest announcement.
In a press release attributed to U.S. Senator Jon Tester (D-Montana)--who also put pressure on the Treasury Department--Heather McDowell, Sibanye-Stillwater vice president, legal and external affairs, Americas, said, "As the only domestic primary producer of platinum and palladium on scale ... being able to claim a tax credit on our mining and recycling costs is an important step in stabilizing our operations so that we can continue to invest in sustainable critical minerals production for the U.S. market."
Industrial Info is tracking proposed projects from Sibanye-Stillwater at its East Boulder platinum mining and milling operation in Big Timber, Montana. An expansion of the mine, which is designed to wrap up in 2026, would boost the capacity from 580,000 tons per year to 700,000 tons per year; three expansions also are proposed for the tailings storage facility, which currently has enough storage capacity for milling through the end of 2024. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for a full list of proposed projects at the mine.
Alcoa Corporation (NYSE:AA) (Pittsburgh, Pennsylvania) also applauded the final rules. "Section 45X is an important tool for shoring up domestic manufacturing of critical materials, including commercial-grade aluminum from Alcoa's U.S. smelters in Newburgh, Indiana, and Massena, New York," the company said in a press release. "The aluminum produced at these facilities plays a crucial role in multiple domestic manufacturing segments including clean energy, automotive, aerospace and building materials."
Subscribers to the GMI Plant Database can read profiles on the Massena and Newburgh smelters.
Alcoa is exploring the restart and expansion/life extension of its Liberty coal mine in Boonville, Indiana, to provide high-sulfur steam coal to fuel the nearby Newburgh smelter. The project is active and in its permitting phase, but Alcoa announced in March it was delaying the project. Subscribers to the GMI Project Database can click here to read the project report.
However, following the announcement of the final rules, Rich Nolan, president and chief executive officer of the National Mining Association, criticized the treasury's decision to "limit the credit to those producers who also refine materials," noting this will prohibit many important projects from benefiting from the credit. "We have an urgent need to level the playing field for American producers against Chinese and Russian efforts to dominate global mineral supplies by flooding the markets with oversupply of cheap minerals ... by making U.S. processed, foreign sourced materials available for the credit we're not solving the problem. Made-in-America should also mean mined-in-America and the miners who secure the very first link in our supply chains should benefit from the same credits as the entities that refine their materials."
Subscribers to Industrial Info's GMI Project and Plant databases can click here for a full list of detailed reports for projects mentioned in this article, and click here for a full list of related plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
