Canada vs. US Mining: Resource Nationalism & Sovereignty

A controversial graphite mine financed in part by the Pentagon is planned for a relatively untouched wooded area of southwestern Quebec known as La Petite-Nation, sparking opposition from local residents concerned about environmental impacts and the region’s growing eco-tourism economy.

Project Background

Lomiko Metals, a British Columbia-based company, intends to build an open-air graphite mine in La Petite-Nation, with plans to produce 100,000 tonnes of graphite annually for 15 years. The project has faced resistance for eight years due to concerns about dust emissions from open-air mines polluting air and water sources.

Initially, the project was presented as environmentally friendly and supporting the energy transition, according to Louis St-Hilaire, president of the La Petite-Nation Lakes Protection Group, a coalition of 10 lake protection associations opposing the mine. Residents acknowledged the need for graphite in lithium-ion battery production, but concerns remained.

U.S. Investment

In 2024, the Pentagon announced an $8.3 million investment in the project through the Defense Production Act investment program, aimed at securing resources for national defense. This investment occurred alongside a $20 million grant for a cobalt refinery in Ontario and $6.4 million for a bismuth and cobalt project in the Northwest Territories.

“Suddenly, the main big investor is the American army, who need a lot of graphite,” said St-Hilaire. “People want that even less.” David Pharand, the mayor of Duhamel, stated that the U.S. military’s involvement has galvanized further opposition to the mine.

A referendum in August 2025 showed that 95% of residents in surrounding communities opposed the project.

Strategic Importance

The U.S. involvement stems from a desire to reduce dependence on China for critical minerals, according to Ben Steinberg, spokesperson for the Battery Materials & Technology Coalition. The military requires graphite for batteries and components needing heat resistance and durability, as China currently dominates graphite production.

“China has the ability to suppress and manipulate the graphite market,” said Steinberg. “So we have all the interest in the world to be working, between the United States and Canada, to exploit this resource and utilise it for all these important things.”

Political Concerns and Project Status

Some Canadians have expressed concerns about the U.S. investment, referencing past threats from Donald Trump to annex Canada. Jean-François Desmarais, a leader of one of the opposing groups, questioned the irony of allowing the American military to exploit Canadian resources.

The impact of ongoing trade disputes between Canada and the United States on mining collaborations remains unclear. Despite local opposition, the mine project is proceeding, with Lomiko Metals already processing samples from the site. The provincial government has declined to fund the project due to lack of social acceptance, but the federal government has not withdrawn its funding.

Local communities are exploring alternative sustainable development projects. “We have a wildlife reserve and a provincial park right here, and they are getting more and more visitors every year,” said Pharland. “I think people don’t understand why we would hurt this growth in favour of a mine that will run out of resources in 15 years.”

Lomiko Metals did not respond to requests for comment.