Critical minerals have a new type of investor: "HALO" funds

Governments and infrastructure funds are treating mining as a low-obsolescence asset — but only release capital to those with ESG built into the project from the design stage.

Pension funds and infrastructure investors are creating a new capital category for critical minerals, internally called "HALO" investments — short for Heavy Assets, Low Obsolescence. It's money drawn precisely by the fact that a mine can't be replicated or replaced by software, the opposite of what these funds avoid in other sectors.

The detail that changes the game for fundraisers: the six major types of capital available today for critical minerals — government agencies, multilateral banks, private equity, pension funds, infrastructure investors and manufacturers (OEMs) — now treat environmental and social performance as a non-negotiable prerequisite, not a differentiator. That includes water management, engagement with communities and rights holders, and nature impact assessment, all required before capital is released, not after.

Critical minerals projects that don't build ESG into their design from the start are being excluded from entire pools of capital, regardless of the geological quality of the deposit. This inverts an old logic of the sector, where ESG was treated as a post-approval cost. Today it's an entry filter.