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Biggest copper mining project in decades begins production

2021-06-04 22:15
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Biggest copper mining project in decades begins production

Edited by Cecilia Jamasmie in www.mining.com

Canada’s Ivanhoe Mines has begun producing copper concentrate at its Kamoa-Kakula project in the Democratic Republic of Congo (DRC) months ahead of schedule as the metal continues to trade close to all-time highs.

 

Ivanhoe and partner Zijin Mining said first ore was introduced into the concentrator plant on May 20.

 

Kicking off production at Kamoa is indeed a momentous event for the copper market. Most of the current top producing mines are decades old and, except rare exceptions such as SolGold’s Cascabel in Ecuador and Anglo American’s Quellaveco project in Peru, there haven’t been major new discoveries in years.

 

While copper projects are in the pipeline, producers are wary of repeating oversupply mistakes of past cycles by speeding up plans at a time when mines are getting a lot trickier and pricier to build —one reason why copper prices are near decade highs at above $4 per pound.

 

The copper industry needs to spend upwards of $100 billion to close what could be an annual supply deficit of 4.7 million metric tonnes by 2030, according to estimates from CRU Group. The potential shortfall could reach 10 million tonnes if no mines get built, commodities trader Trafigura has said.

 

Operations at Kamoa-Kakula are set to ramp up this year to reach between 80,000 and 95,000 tonnes of copper in concentrate. After several phases of expansion, the mine’s peak annual copper production will be more than 800,000 tonnes.

 

Given the current copper price environment, Ivanhoe and Zijin are exploring expanding production capacity from the current 7.6 Mtpa capacity (to be implemented in two phases of 3.8 Mtpa) to 11.4 Mtpa. This may be achieved by adding output from other targets in the concession —Kansoko, Kamoa North (including the Bonanza Zone) and Kakula West.

 

Kamoa-Kakula is a strategic partnership between Ivanhoe Mines (39.6%), Zijin Mining Group (39.6%), Crystal River Global Limited (0.8%) and the DRC government (20%).