Project Vault

Project Vault Latest News

The US government recently rolled out Project Vault, a $12 billion scheme to stockpile rare earths and critical minerals, aiming to shield American companies from global supply disruptions.

About Project Vault

• It is a $12 billion scheme launched by the United States to stockpile rare earths and critical minerals, aiming to shield American companies from global supply disruptions.
• It is a public-private partnership that will buy and store critical minerals and rare earth elements. 
  • These minerals are used in products such as smartphones, batteries, jet engines, and electric vehicles. 
• The project is similar to the US Strategic Petroleum Reserve, which stores emergency oil supplies. However, instead of crude oil, Project Vault will focus on minerals.
• It will combine $1.67 billion in private seed funding with another $10 billion from the US government’s Export-Import Bank.
• How will the stockpiling system work?
  • Companies will make an initial commitment to buy materials later at a fixed inventory price. They will also pay some upfront fees. 
  • Based on these commitments, companies can give Project Vault a list of the materials they need. The project will then purchase and store those materials.
  • Manufacturers will pay a carrying cost that covers loan interest and storage expenses.
• When can companies access the stored minerals?
  • Companies will be allowed to use their stored materials as long as they replace what they take out. 
  • In case of a major supply disruption, firms will be able to access their entire stockpile.
  • A key feature of the plan is that companies must agree to repurchase the same amount of materials in the future at the same price.

Source: BS

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