Elbows up? Canada is letting Pentagon take ‘unprecedented’ stakes in Canadian mines

May 22, 2026

By fast-tracking critical minerals, Canada is not simply building a green economy. It is being further integrated into the U.S. war industry

Even as Prime Minister Mark Carney touts his plans to protect Canada’s economic sovereignty, the country’s critical minerals are making their way into U.S. weapons. 

According to legal experts, the U.S. is taking “possibly unprecedented” measures to secure ownership over Canadian mines, turning Canada—and the First Nations from whose lands the minerals are sourced—into a U.S. mining territory. All the while, the Canadian government is helping fund and fast-track these projects. 

From the provincial to the federal levels, Canada has been on a tear of expediting the extraction of critical minerals from its far north. These minerals were branded as “urgently necessary”—first for the transition to clean energy, and then, amid U.S. annexation threats, for Canada’s national security. 

Nickel, copper, graphite, cobalt, tungsten, chromium, and rare earth elements are not just inputs for batteries and wind turbines. They are also needed to build fighter jets, drones, missiles, radar systems, submarines, armour, and ammunition.

As I explain in a policy paper for the Transition Security Project, Canada has long been a reliable supplier of inputs for the United States’ wars. From Canada’s underbelly came the uranium for the U.S.’s nuclear bombs, nickel for armoured plates on its battleships, and aluminium for its warplanes. 

But when Canadian minerals are being earmarked for foreign military manufacturing, is that really in Canada’s national interest? 

Batteries or bombs?

To secure these minerals, historically the U.S. has offered state-backed grants and subsidies to Canadian mining companies. But the escalating U.S. Cold War with China is seeing the Pentagon ramp up its investments. Starting in 2022, the U.S. Department of War began pouring millions of dollars into Canadian mining companies extracting critical minerals. 

At the time, the news barely registered in Canada. Instead, papers ran headlines about federal and provincial promises that the same minerals would fuel a clean-tech revolution made of electric vehicles and battery plants. But the latest funding behind Canada’s critical minerals craze is coming from the Pentagon, which oversees the single largest emitter of greenhouse gases on the planet: the U.S. military. 

Over just two years in 2024 and 2025, the Pentagon invested over $78 million USD in companies operating mining projects in Canada: Fortune Minerals, Lomiko Metals, Fireweed Metals, Northcliff Resources, Nano One Materials, and Electra Battery Materials. 

Framed as cooperation, the arrangement has shifted Canadian mining priorities to suit U.S. military needs—even in a time of tension between the two countries. 

Then in 2025, the Department of War spent $35.6 million USD to acquire a 10 per cent equity stake in Vancouver-based mining company Trilogy Metals, which is planning to extract Alaskan copper, cobalt, gold, and silver. It came with options to increase its ownership in the future, and the right to appoint a board member. The U.S. Department of Energy also bought a 5 per cent stake in Lithium Americas, another Vancouver-based company that’s developing one of the world’s largest lithium mines. 

That the U.S. federal government is a shareholder in Canadian mining companies is a “possibly unprecedented” arrangement, according to the international lawyer Lawrence Herman.

These aren’t controlling shares, but antitrust lawyer Sandy Walker has warned that once these mines are operating, the U.S. government could insist that the minerals go only to the U.S.

Canada has policies allowing it to restrict the domestic investments of foreign governments—especially if the investments could be “injurious” to Canada’s national security. In 2022 the Canadian government ordered three Chinese firms to divest from Canadian critical minerals companies. No such order has cracked down on U.S. state investments in Trilogy Metals or Lithium Americas.

The climate bait-and-switch

Nearly all the mining projects that the Pentagon has invested in are being framed as climate solutions. In Quebec, Lomiko Metals pitches its proposed La Loutre graphite mine as part of “a local, renewable energy ecosystem.” It secured an $8.4 million USD grant from the Pentagon, matched by a further $4.9 million CAD grant from Natural Resources Canada.

But the open-pit project produces graphite, the most commonly-used material in the military industry. Given that the U.S. has not produced its own graphite since the 1950s and remains heavily dependent on Chinese supply, the Dept. of War’s investment is highly strategic.

Many of the minerals being sought through these projects, including graphite, are “dual use,” meaning they can support both civilian and military applications. But Canada’s environmental assessment processes do not ask where minerals will ultimately go once they leave the mine site. They do not ask whether extracted materials will power batteries or weapons.

That matters because critical mineral supply chains are deeply opaque. Minerals are blended, traded, processed, and transformed across multiple jurisdictions, making their end-use extremely difficult to trace. 

This becomes a problem when extracting these minerals in the first place is justified by arguing that Canada needs to build home-grown climate change solutions.

Under this argument, environmental assessments and Indigenous consultation are framed as unnecessary obstacles to urgent action on climate change. Carney’s campaign promises to “build, baby, build” have materialized in provincial and federal laws that “cut the red tape” around projects deemed to be in the “national interest.” 

Ottawa has not simply watched the U.S. take control of Canada’s critical minerals, it is helping pay for it. As my research for the Transition Security Project shows, almost every one of the recent U.S. Department of War investments were paired with Canadian public funds. While the Pentagon allocated over $78 million USD to the six Canadian critical-minerals projects mentioned above, the Canadian government matched those investments with $69 million CAD, effectively subsidizing U.S. state influence in our natural resources sector. 

This development is a threat not only to Canada’s independence, climate, and environment, but also to Indigenous sovereignty. If minerals from Indigenous territories are being mined to make weapons, do local First Nations get to know? Do they get to refuse? Affected First Nations are being told to accept damage to their homelands in the name of climate action, while the actual purpose may be U.S. military expansion.

Indigenous resistance has been felt across Canada. The La Loutre graphite mine has faced strong opposition from the Kitigan Zibi Anishinabeg First Nation—which led to Quebec refusing to fund the project due to a lack of “social acceptability.” Mining roads proposed by Trilogy Metals in Alaska—a crowbar to pry open access to copper and cobalt deposits—have faced fierce opposition from 40 Alaska Native tribes.

In New Brunswick, the proposed Sisson tungsten project, owned by Northcliff Resources, received $15 million USD in Pentagon funding. Tungsten carbide, an exceptionally hard metal, is used in armour-piercing ammunition. Wolastoqey leaders have opposed the project for years. Elder Alma Brooks has said she is “absolutely and totally against anything that would support the United States or Canadian military in their war efforts.”

The Pentagon’s new investment strategy should force a public reckoning. Canada is not simply building a green economy. It is being more deeply integrated into the U.S. war industry.