A China-linked investor has finally sold its stake in Northern Minerals months after government demands

A China-linked Northern Minerals investor, which for months ignored federal government demands to sell its shares in the rare earths hopeful, has finally sold up.

Northern Minerals' Browns Range heavy rare earths project. Picture: Supplied

The final tranche of shares in Northern Minerals which China-linked investors were ordered to divest by early September has finally been sold, the company says.

Treasurer Jim Chalmers in June last year ordered five China-linked investors to sell 613 million shares in Northern Minerals, comprising 10.4 per cent of the share register, on national interest grounds.

The stock was meant to be sold by September last year, but as of the publication of the company’s half yearly report on March 14, one unidentified investor who held 146.2 million shares had failed to comply with the order.

Northern Minerals told the ASX on Monday the outstanding shares had been divested “effective 28 March, 2025, which means all of the shares subject to the orders have been divested’’.

Federal Treasurer Jim Chalmers.

Northern Minerals’ flagship asset is the Browns Range heavy rare earths project in the Tanami region of Western Australia.

The project has all of its key approvals in place, according to a recent presentation, and the company is working on updating the definitive feasibility study for the mine in the second quarter of this calendar year.

But, as The Australian reported earlier this month, the unresolved issues around the China-linked investors remained a barrier to the company securing the funding it is seeking from the Northern Australia Infrastructure Facility and Export Finance Australia.

Northern Minerals managing director Shane Hartwig said at the time the company was aware this issue was one which needed to be cleared up.

“The company is aware the profile of its larger shareholders will be one of the items that NAIF and EFA will review as part of their standard diligence processes,’’ he said.

“The next stage of engagement with these agencies is the provision of the feasibility study for the Browns Range project once completed.

“The company notes that changes to its share register are likely given the requirement for additional equity to fund the development.”

Former defence minister Linda Reynolds has warned about China’s stranglehold on the rare earths sector.

The Northern Minerals annual general meeting last November saw a mystery Chinese businessman come close to securing a seat on the board.

The company also revealed at the meeting it had been unable to contact a Hong Kong-registered entity which became a major shareholder in the wake of the divestment order.

Former defence minister Linda Reynolds said earlier this month China was manipulating the critical minerals sector, using its market dominance as a tool of geo-strategic influence.

She also said China was using price manipulation to gain leverage over Australian producers and projects.

“For many years, China has been quietly and persistently manipulating critical minerals and rare earth commodity markets to strategically stockpile the offtake and process it in China,” she said.

“China now dominates global markets for these processed commodities. This provides China with an overwhelming economic advantage in the new energy technology sector — an advantage they have been willing to use as a powerful geo-strategic political weapon.”

Despite rare earths being top of the political agenda globally, with US President Donald Trump using access to Ukraine’s supposed rare earths resources as a bargaining chip for further military support, many projects in the West have struggled to come into production due to low commodity prices.

Jack Lifton, co-chair of the Canada-based Critical Minerals Institute, said earlier this month that Ukraine itself has no economically mineable rare earths deposits they were aware of.

The investors which were ordered to sell their shares last year were the Singapore-registered Yuxiao Fund, controlled by Chinese businessman Wu Tao, and four associates including Black Stone Resources, Indian Ocean International Shipping and Service Company, Ximei Liu and Xi Wang.

Northern Minerals shares added 5 per cent to 2.1c on Monday, but are well below levels — around 7c — they were fetching in 2021.

The company has a market capitalisation of about $170m.

Northern Minerals told The Australian via a spokesman it was not involved in the recent share transaction.

Originally published as A China-linked investor has finally sold its stake in Northern Minerals months after government demands