Why AI startups and political insiders won’t deliver America’s critical minerals

OPINION:

For the past 30-plus years, the average U.S. citizen has largely forgotten about the contributions, societal impact and inherent value of critical minerals and mining in general.

In 1996, the Clinton administration attempted to put the nail in the coffin and shuttered the U.S. Bureau of Mines. After 85 years of service, the bureau was placed on a shelf and no longer funded. Subsequently, various other related departments either disappeared or were assigned to other federal government agencies, such as the U.S. Geological Survey.

In recent years, the world has started to wake up to the fact that critical minerals are essential to everyday life. Every government created critical mineral lists, which were similar but not identical. The USGS has created a critical minerals list, but it is backward-focused and misses future opportunities and growth factors. For example, it does not include copper. After considerable debate and uproar, the Energy Department added copper and a few more elements to its own list, which contains more than 45 elements that need to be supplied by mineral production. Most of these are supplied to the U.S. by other countries, such as China and Russia.

As a result, mining has quickly returned to favor, and the media publish articles on minerals and mining daily. Thankfully, there is now a push to resuscitate the Bureau of Mines.

However, this growing momentum also has a downside: New “mining” startups are popping up everywhere. Wall Street executives who have never stepped on a mine site are allegedly becoming instant experts. They are found on panels at critical mineral conferences, testifying to congressional subcommittees, getting airtime on cable news and generally making themselves look foolish. Writ large, they are all promising to save America with unachievable timelines and mineral production claims that aren’t economical.

Tech billionaires, who were once fond of funding opposition to mining projects, are becoming overnight investors and supposed heroes. Add to this former presidents, prime ministers, senators, retired military officers and Cabinet members, and you now have the greatest collection of nonexperts setting strategies and seeking government grants and equity loans to develop mineral deposits that have little to no chance of success.

These businesses are not seasoned mining companies. They have one or two potential projects and no revenue production, and they promote these projects to raise capital, hoping that a midtier or larger company will buy them. Meanwhile, their promoters sell their self-issued shares and walk away with their pockets heavily lined.

A prime example of these supposed miners is KoBold Metals. Based in Berkeley, California, the company has generated significant (and misplaced) media attention with glitter-ridden marketing about the use of artificial intelligence in the discovery of mineral deposits and forecasts of producing mineral products in record time.

KoBold claims it is “building the world’s largest collection of geoscience information.” The reality, however, is that KoBold is an unproven company with no track record and likely little intention to follow through on its commitments. To date, AI has not been successful in identifying any new mineral deposits.

This year, KoBold attracted significant investments from green tech billionaires Bill Gates and Jeff Bezos. Despite this fundraising success, the company lacks the knowledge and expertise to develop a mineral discovery to production. This lack of skills and proper team expertise will cause schedule delays along their entire timelines, resulting in capital overruns and increased operating costs.

The truth is simple: There are no shortcuts to obtaining permits, operating plans or successful production starts, no matter how famous the names associated with it or their total net worth. Meanwhile, the media, Wall Street types and now senior Trump administration officials are blinded by the shiny glitter, along with a desire to be on center stage.

Here’s a case in point. Businessman Massad Boulos, the State Department’s new senior adviser for Africa (and Tiffany Trump’s father-in-law) reportedly helped broker a deal for KoBold to purchase a lithium deposit in Congo. According to a May 7 article in Politico’s E&E News: KoBold “said the Trump administration helped shepherd through the deal and in a message on X thanked Secretary of State Marco Rubio; Massad Boulos, the department’s senior adviser for Africa; and Congolese President Felix Tshisekedi for ‘opening doors for U.S. investment’ and agreeing on a framework for the investment.” The Trump administration may come to regret this support.

The overall project management skills required to form the experienced teams, properly scope the engineering studies and execute engineering (followed by procurement and construction) takes years and substantial, ongoing investment. No matter how shiny the suit, how ivory the tower or how big the net worth, there is no substitution for real mining companies and experienced mining workers.

Responsible mining is a complex endeavor that requires a multitude of disciplines, experiences and skills. Anything less, such as what KoBold is promoting, gives the actual mining industry a reputational black eye. Hopefully, policymakers in Washington and states nationwide will start to understand the difference. Securing America’s critical minerals future is no task for amateurs.

• Marc LeVier is the former president of the Society for Mining, Metallurgy & Exploration.