Solaris abandons proposed financing with Chinese company after deal stalled in national security review – by Niall McGee (Globe and Mail – May 22, 2024)

Canadian critical minerals company Solaris Resources Inc. has called off its financing deal with China’s Zijin Mining Group Co. Ltd. after failing to receive regulatory approval from Ottawa, which had been vetting the transaction on national security grounds. Vancouver-based Solaris in January said that Zijin intended to pay $130-million for a 15-per-cent equity stake in the company.

Solaris had planned to use the funds to advance its early-stage Warintza copper project in Ecuador. If the deal had been approved, Zijin would have been entitled to a seat on Solaris’s board, giving it influence over the strategic direction of the company. Copper, along with nickel, lithium and graphite, is used in electric-vehicle batteries and other low-carbon energy sources.

Federal Industry Minister François-Philippe Champagne said in late 2022 that he would only allow Chinese companies to finance Canadian critical minerals companies on an exceptional basis. Ottawa tightened the rules in large part because China has become so powerful in controlling the supply chain of many critical minerals, particularly battery metals such as lithium, cobalt and graphite.

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