The Trump administration this week moved to take partial ownership of a third critical minerals company, part of an unusual trend that’s generating buzz about future deals and possible risks for taxpayers and the environment.
The U.S. government is pursuing equity stakes in companies with mineral operations or plans in Nevada, California and Alaska as it moves to secure supply chains that China currently dominates and throttles through export restrictions or by driving down prices to squeeze out competition.
“It’s very rare for western governments to do this in modern times. It’s more of a China and Russia play [to] take stakes in mineral mining companies through state-owned enterprises,” said Simon Moores, CEO of Benchmark Mineral Intelligence. “Traditionally, the U.S. would create incentives to spur the private sector to take on the investment and development burden.
“But with critical minerals, it’s an uneven playing field,” he added.
On Monday, President Donald Trump announced from the Oval Office that the Department of Defense was taking a 10 percent equity stake in Trilogy Metals, a Vancouver-based company that has mining claims in an isolated part of northwestern Alaska. Under the deal, the government is also investing $35.6 million to support Trilogy’s exploration and has warrants to purchase an additional 7.5 percent of the company.
A week earlier, the Department of Energy took a 5 percent equity stake in another Canadian company, Lithium Americas, which is developing a massive lithium mine and processing plant in Nevada with a multibillion-dollar federal loan. Before that, the DOD became the biggest stakeholder in MP Materials, a Las Vegas-based company operating the nation’s only rare earths mine in California.
Trump officials say they’re focus is on national security and jump-starting a domestic mining and processing sector to pump out critical minerals and reduce U.S. reliance on China. At the same time, Trump has hammered out mineral-linked deals in Greenland, Ukraine and the Democratic Republic of the Congo while his administration has set aside billions for mining projects, fast-tracked permits for U.S. projects, opened up more public lands for mining activity and boosted stockpiling of minerals.
“President Trump pledged to upend the status quo policymaking that has clearly left glaring holes in America’s national and economic security,” said White House spokesperson Kush Desai. “The Administration is committed to using every lever of executive power to deliver on this pledge.”
Energy Secretary Chris Wright has said the stakes will ensure the U.S. can enter into and compete in markets dominated by foreign adversaries and emphasized that not all stakes will be permanent. “By maintaining equity ownership in critical mineral projects, the administration is making better deals for the American taxpayer and ensuring these projects reach completion,” said Ben Dietderich, a spokesperson for the DOE.
Officials from the Department of Defense did not respond to a request for comment by press time.
Academic experts and analysts say the administration’s approach marks a sharp departure from business-as-usual. The federal government has traditionally relied on grants, loans and tax incentives to stimulate private investment while maintaining distance from ownership, said Stephen Empedocles, CEO at the advisory firm Clark Street Associates.
“This model signals a change in U.S. industrial policy — one that treats the federal government less as a grantmaker and more as a strategic investor,” said Empedocles. “It sets a precedent for similar approaches in semiconductors and other critical supply chains.”
Speculation is soaring around what deals could be next. A White House official said the administration is in ”constant touch” with the private sector and “receives hundreds of deal proposals involving equity stakes.” But they also pushed back on reports that the White House is considering taking a stake in a company developing a rare earths mine in Greenland.
Some have raised concerns about the government’s shift into the private sector. Tyler Cowen, a professor of economics at George Mason University, asserted in a recent column for The Free Press that Trump is turning major U.S. businesses into arms of the government. “A dose of government ownership and the associated politicization are not what American industry and innovation need,” Cowen wrote.
Thea Riofrancos, a political science professor at Providence College, said the administration is using taxpayer money to take small and partial ownership stakes in private companies to jump-start investment in a sector that’s flagging. That playbook, she said, partially aligns with the concept of “resource nationalism,” an ideology through which the state deems resources critical to the economy or national security and intervenes. But she warned there is no clear governance or regulatory structure to ensure minerals are being used for public benefit.
“It’s resource nationalism but MAGA-style,” said Riofrancos.
But Ian Lange, director of the mineral and energy economics program at the Colorado School of Mines, said that while the administration’s approach brings with it the potential downside of being viewed as picking winners and losers, he doesn’t see a threat of the government taking control of private assets.
“The United States has rule of law,” said Lange. “I don’t think there’s a belief that the U.S. government taking these equity stakes means that soon, the U.S. government might take over these deposits … they’re not.”
‘What’s changed is the philosophy’
The U.S. government’s decision to take equity stakes in private companies is rare outside of crisis periods like the 2008 financial crisis, said Empedocles with Clark Street Associates.
The emerging strategy, he said, marks a “new phase” in how Washington approaches industrial policy, but emphasized that the shift toward equity isn’t replacing more traditional tools like grants, loans and tax incentives.
“Over the past two months, the administration has announced plans for more than $6 billion in grants and $100 billion in loans for critical minerals and manufacturing infrastructure,” he said. “What’s changed is philosophy. The U.S. government is no longer just funding industrial progress, but it’s actively expanding its vast financial resources and tools with its full array of regulatory powers to fulfill its top priorities.”
To be sure, the government has had a hand in shoring up minerals in the past, including maintaining mineral stockpiles across the nation during the first decade of the Cold War and agreeing to purchase certain materials like tungsten needed for military equipment.
The Trump White House strategy emerging now responds in part to congressional pressure and the mining sector, which has called for a more aggressive approach to counter China while acknowledging market manipulation and focusing federal leadership.
Empedocles and others said the motivation behind Trump’s new approach is clear: accelerating domestic mineral production, reducing dependence on China and rebuilding critical supply chains. To that end, the administration is seeking “modest equity” positions in exchange for restructuring existing federal loans or enabling projects blocked by permitting or financing barriers, he said.
In the case of Lithium Americas, the Energy Department took a 5 percent equity stake in the company as it renegotiated a Biden-era $2.3 billion federal loan for a processing facility next to the Thacker Pass mine in Nevada. The administration, he said, used a similar playbook with Trilogy Metals and MP Materials.
“In each case, Washington leverages its capital and regulatory authority to advance projects that expand domestic access to materials like lithium, copper and rare earths,” he said. “These investments are also acting as a hedge for the taxpayers in a new area with uncertain outcome, like onshoring critical minerals.”
‘Deeply concerning’
Not everyone is on board with the White House game plan.
Riofrancos with Providence College said mining companies, some foreign, and wealthy Americans will most immediately benefit from the government taking equity stakes in private companies, and it’s not clear where and how taxpayers fit in.
Indeed, stock prices for Trilogy, Lithium Americans and MP Materials soared in the wake of deals being made.
Mining projects — including those the administration is now championing — are also mired in concerns tied to water quality, fragile ecosystems, Indigenous rights and climate change.
Environmental groups and tribes, for example, are vowing to fight the Ambler Road project that would provide access to a remote mining district in Alaska, including areas that Trilogy Metals is exploring.
The Trump administration has argued the road is critical for national security and the state’s economy, but critics counter that it will cut through iconic and pristine Alaska wilderness, including the southern Brooks Range and Gates of the Arctic National Park and Preserve, areas that provide habitat for salmon, sheefish, caribou, birds and moose.
Trilogy Metals did not immediately respond when asked for comment.
Cooper Freeman, the Center for Biological Diversity’s Alaska director, said the federal government shouldn’t be using taxpayer dollars to support mining projects owned by foreign companies that are still in the exploratory phase.
“These projects will all be environmentally devastating and they should have to pencil out financially and stand on their own,” said Freeman. “Trump is trying to make his mining fantasy real by gambling with American taxpayer money, and his business record is littered with bankruptcies.”
Riofrancos also said that while Trump has repeatedly said minerals are needed for artificial intelligence, data centers and military technologies, growing demand for materials like lithium is more closely tied to demand for renewables and electric vehicles, which the administration is undercutting.
“Trump is destroying governmental support and momentum in energy transition sectors,” she said. “But those are the sectors where the demand comes from for these minerals, especially lithium and rare earths. It’s very contradictory.”
