The Cut Inflation Act of 2022 provides a 10% advanced manufacturing tax credit applicable to most planned NioCorp products
New Federal Electric Vehicle Tax Credit Linked to Growing Use of Critical Minerals Produced in the U.S. or Allied Countries
CENTENARY, Colo., August 17, 2022 /PRNewswire/ — The “Cut Inflation Act of 2022,” signed into law by President Biden this week, includes multiple financial and fiscal incentives designed to encourage greater production of critical minerals in the United States. Virtually all critical minerals NioCorp Developments Ltd. (“NioCorp” or the “Company”) (TSX: NB) (OTCQX:NIOBF) intends to produce at its Elk Creek Critical Minerals project in Nebraska (the “Project”) would be eligible for new tax credits once the project is funded and put into commercial production.
“President Biden and congressional leaders deserve credit for ‘following the lead’ in this legislation on the need to produce more of our own critical minerals in the United States and reduce our reliance on minerals. foreign nations that hold the key to our nation’s success in transitioning to a less carbon-intensive economy,” said Mark A. SmithPresident, CEO and Executive Chairman of NioCorp.
Advanced Manufacturing Tax Credit includes production of essential minerals
The bill creates a new 10% advanced manufacturing tax credit for a variety of critical minerals produced in the United States, including niobium, scandium and titanium. If NioCorp deemed it economical to produce the magnetic rare earths neodymium, praseodymium, dysprosium and terbium, and once the project was funded and put into commercial production, the 10% tax credit would also apply to the cost of producing these products.
“NioCorp could benefit significantly from these new production tax credits in the future,” Smith said. “This provision and others in this bill send a strong signal to producers, markets and investors that the U.S. government wants to up its game by encouraging greater production of critical U.S.-made minerals.”
Electric vehicle tax credit tied to domestic production of critical minerals
The legislation revises the current $7,500 federal electric vehicle (EV) tax credit. The new credit will apply to the purchase of vehicles that meet specific vehicle purchase criteria: (1) final assembly of the vehicle must take place in North America; (2) specific percentages of critical vehicle battery minerals must be sourced or recycled in the United States or produced in a United States Free Trade Agreement partner country;1 and (3) specified percentages of vehicle battery components must be manufactured in North America.
The bill specifically excludes the application of the EV tax credit for vehicles put into service after December 31, 2024 that use critical minerals in the vehicle battery that have been mined, processed or recycled by a “foreign entity of concern”, which includes China, Russia, IranWhere North Korea.
The bill extends the electric vehicle tax credit through 2032 and requires increasing levels of critical minerals used in electric vehicle batteries to be purchased or recycled in the United States or a country with which the states States have concluded a free trade agreement. The percentage of the value of critical minerals mined or processed in the United States or in a United States free trade partner or recycled in North America must be:
- 40% for an EV put into service before January 1, 2024;
- 50% for an EV put into service during calendar year 2024;
- 60% for an EV put into service during calendar year 2025;
- 70% for an EV put into service during calendar year 2026; and
- 80% for an EV put into service after December 31, 2026.
Other provisions of the bill that could benefit NioCorp
Other provisions of the bill are intended to encourage greater production of critical minerals in the United States:
- $500 million for “increased use” of the Defense Production Act to provide economic incentives to create, maintain, protect, expand, or restore domestic sources of critical components, critical technology items, and industrial resources.
- $40 billion commitment authority for the U.S. Department of Energy’s Innovative Technology Loan Guarantee Program (Title XVII), in addition to DOE’s existing commitment authority of approximately $24 billion. The Innovative Technology Loan Guarantee Program authorizes loan guarantees for projects that (1) “avoid, reduce, use or sequester” air pollutants or anthropogenic greenhouse gas emissions; and (2) employ “new or significantly improved technologies” over commercial technologies in use in United States at the time the warranty is issued.
For more information:
Contact Jim SimsCorporate Communications Manager, NioCorp Developments Ltd., 720-639-4650, [email protected]
Source: NioCorp Developments Ltd.
@NioCorp $NB.TO $NIOBF $BR3 #Niobium #Scandium #rareearth #neodymium #dysprosium #terbium #ElkCreek #EV #electricvehicle
NioCorp is developing a critical minerals project in Southeast Nebraska which will produce niobium, scandium and titanium. The Company is also evaluating the production potential of several rare earths from the Project. Niobium is used to produce specialty alloys as well as high-strength low-alloy (“HSLA”) steel, which is a lighter, stronger steel used in automotive, structural and pipeline applications. Scandium is a special metal that can be combined with aluminum to make alloys with increased strength and better corrosion resistance. Scandium is also an essential component of advanced solid oxide fuel cells. Titanium is used in various light alloys and is a key component of pigments used in paper, paint and plastics and is also used for aerospace applications, armor and medical implants. Magnetic rare earths, such as neodymium, praseodymium, terbium, and dysprosium, are essential to the manufacture of neodymium-iron-boron (“NdFeB”) magnets, which are used in a wide variety of military and civilian applications .
Caution Regarding Forward-Looking Statements
Neither the Toronto Stock Exchange (“TSX”) nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this material. Certain statements contained herein may constitute forward-looking statements, including, but not limited to, statements relating to the Company’s expectations regarding the anticipated benefits of the Cut Inflation Act of 2022, including benefits related to advanced manufacturing tax credits, electric vehicle tax credits and provisions encouraging greater production of critical minerals in the United States These forward-looking statements are based on the reasonable expectations and plan of affairs of NioCorp as of the date hereof, which are subject to change depending on economic, political and competitive circumstances and contingencies. Readers are cautioned that these forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause these assumptions to change and that actual results and estimates may differ materially from any future results, achievements or positions estimated or expectations expressed or implied by these forward-looking statements. Risks, uncertainties and other factors that could cause NioCorp’s plans or prospects to change include risks relating to NioCorp’s ability to operate as a going concern; risks relating to NioCorp requiring significant additional capital; changes in demand for and price of commodities (such as fuel and electricity) and currencies; changes or disruptions in the securities markets; legislative, political or economic developments; the need to obtain permits and to comply with laws and regulations and other regulatory requirements; the possibility that actual results of the work may differ from projections/expectations or fail to realize the perceived potential of NioCorp’s projects; risks of accidents, equipment failures and labor disputes or other unforeseen difficulties or disruptions; the possibility of cost overruns or unforeseen expenses in development programs; operational or technical difficulties related to exploration, mining or development activities; the speculative nature of mineral exploration and development, including the risks of diminishing quantities of reserve and resource grades; risks relating to exploration, development and mining activities, and the risks set forth in the Company’s filings with the SEC at www.sec.gov. NioCorp disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
1 The nations that have free trade agreements with the United States are: Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Israel, JordanKorea, Mexico, Morocco, Nicaragua, Oman, Panama, Peruand Singapore.
SOURCE NioCorp Developments Ltd.