The Évian meeting of Group of Seven leaders during the week came out hard on China’s grip on critical minerals.

Mind you, in the 1800-word declaration on the importance of securing the supply of non-Chinese critical minerals, China was not mentioned once.

But Beijing would have got the message loud and clear, with the G7 outlining a framework to go after China’s 70%-plus control of critical minerals.

Together with partner countries – including non-G7 Australia – the leaders of the G7 countries undertook to co-operate closely to advance production, processing and recycling projects across the entire supply chain.

Fine words for sure. But if the G7 is mobilising as it suggests it is – the US got the ball rolling on critical minerals earlier in the year with its US$12 billion Vault initiative – the ASX critical minerals space will be getting a lot more interesting.

Projects in rare earths, lithium, nickel, gallium, tungsten and so on and so on will all be in the frame to benefit from the marshalling of government and private sector support to build the required mines and the downstream processing operations needed to break China’s stranglehold.

“We will promote the development of co-ordinated projects through demand aggregation and the mobilisation of public and private collective financial capacities,” the G7 leaders said at the their meeting, dominated as it was by discussion around a ceasefire in Iran.

Iran’s shutting of the Strait of Hormuz and its impact on the global oil market would have served as reminder to the G7 leaders that concentrated supply chains, as is the case with strategic minerals, is a threat to the global economy and their national security.

Specifically, the G7 leaders said that they “aim to significantly reduce our dependencies on a single supplier outside the G7 and partner countries for rare earths and permanent magnets to under 60 per cent by 2030 and continuing to decrease further over time, with an ambition to reach 50 per cent as soon as possible”.

“For other critical minerals, we task the relevant ministers with setting a specific target for reducing these dependencies before the end of the year,” the G7 leaders said.

“To ensure greater impact, we task the G7 Development Finance Institutions and export credit agencies to enhance coordination and collaboration on critical minerals and enabling infrastructures, including with the private sector.”

The G7 is also determined to ensure traceability and transparency regarding the origin of critical minerals. The way it goes about doing that is to be piloted in the lithium and nickel markets, with five new critical minerals each to be added each year, with a particular attention given to rare earths.

On the contentious issue of governments getting involved in the stockpiling of critical minerals – most already do and it’s what the Vault in the US is all about – the G7 leaders committed to increasing capabilities in the industrial and/or public sector.

An equally contentious issue of governments providing price floors in critical minerals to overcome the price suppression China can wield through various mechanisms was skirted around.

But the G7 leaders did say price-gap subsidies, joint procurement ⁠instruments and trade-related instruments such as quotas and price floors would continue to be explored.

The US and Japan have already moved to provide price floors in rare earths, and tightness in lithium supplies has seen the emergence of industry-provided price floors and government investment in projects, including in Australia.

It has to be said that there was no perceptible improvement in sentiment in the ASX critical minerals space in response to the (unanimous) Évian communique. Perhaps there should have been.

It signalled yet another step-up in government support for the build-out of critical minerals supply chains to break China’s grip on the sector. For the ASX-sector, it means worthy projects can bank more than ever on government support.

Mont Royal (ASX:MRZ):

Mont Royal (MRZ) boss Nick Holthouse reckons the rare earths stock (14c for a $27m market cap) is grossly undervalued.

“So get on board,’’ he said when concluding an investor call on Thursday for an update on MRZ’s hard-rock Ashram project in northern Quebec.

It is one of the biggest deposits anywhere, and at a good grade too. More to the point, its preliminary economic assessment (PEA) has just been updated, covering off on a large-scale project with an initial 30-year mine life

The updated PEA arrived at a post-tax NPV of C$2.02 billion which is kind of interesting inside a $27m company, more so when cast in light of the urgency of the G7 communique (Canada is a member country) on the need for a non-China buildout of new critical mineral supplies.

The PEA outlined robust economics for a project where costs would less than half of the assumed basket price for its product.

It means the IRR at 22.0% and a payback from start of production of 3.9 years is where it needs to be for a critical minerals project costing an initial C$1.23 billion.

The capex does not include the C$700 million or so cost of building a 320km southern road to plug Ashram into Quebec’s rail and ports further south, which is where the rise in government support for such critical minerals projects becomes err…critical.

The provincial and national governments are keen to see development of the northern region but first want to see the support from affected First Nation communities for an infrastructure buildout in their lands.

There has been indications that the First Nations do in fact want to see better access to their lands for their own purposes, with potential mining projects which would also benefit – including Ashram – being called on to help champion the cause.

“The plan is that government comes in and builds this as a piece of national infrastructure,” Holthouse said.

Again, cast it in light of the G7 communique, it seems that Ashram’s development pathway is taking shape faster than MRZ’s current modest market cap suggests.