The warnings are sounding louder and louder: the world is heading towards a desperate shortage of copper. Humans are more dependent than ever on a metal we’ve been using for 10,000 years; new deposits are drying up and the kind of breakthrough technologies that have transformed other commodities have not materialized for copper.
In what could be a game-changer for global sourcing, an American startup claims to have solved a puzzle that has frustrated the mining world for decades. If successful, the discovery by Jetti Resources could unlock millions of tons of new copper to power power grids, construction sites and car fleets around the world, reducing and possibly even closing the gap.
In its simplest form, Jetti’s technology focuses on a common type of ore that traps copper behind a thin film, making it too expensive and difficult to extract. The result is that vast quantities of metal have washed up over the decades in piles of mining waste on the surface, as well as in untapped deposits. To crack the code, Jetti developed a specialized catalyst to disrupt the layer, allowing rock-eating microbes to get to work releasing the trapped copper.
The technology has yet to prove itself on a large scale. But the riches at stake attract some of the most powerful players in the industry.
BHP Group, the biggest mining company, is already an investor and has now spent months negotiating a test plant at its crown jewel Escondida copper mine in Chile, according to people familiar with the matter. US miner Freeport-McMoRan Inc. began implementing Jetti’s technology at an Arizona mine this year, while rival Rio Tinto Group plans to deploy a competing but similar process.
Miners are responding to an increasingly pressing problem. Copper is ubiquitous in the modern world, used in everything from telephones and computers to water pipes and cables. And while the global decarbonization campaign is based on phasing out polluting natural resources like oil and coal, an electrified future will need more copper than ever.
Despite its importance, the world faces a growing threat of scarcity in the coming decades. The best mines are aging and the few new discoveries are either in hard-to-mine places or face years of opposition to development.
The history of commodity markets shows that impending deficits tend to spur new discoveries and technologies. The US shale boom in the 2010s shook up the oil market, while breakthroughs in nickel processing upended supply forecasts.
But new discoveries of copper are increasingly unlikely, given the long history of mining – evidence of copper use dates back to at least 8,000 BC in what is now Turkey. and Iraq. This means that most of the world’s major deposits have already been discovered and exploited; more than half of the world’s 20 largest copper mines were discovered more than a century ago.
Yet the long history of copper mining also means that there are huge amounts of metal on the surface of landfills.
The reason for this is a principle as old as mining itself: ore is mined from the earth, the easiest metal is mined, and anything too difficult or expensive to process is thrown away as waste. In the past decade alone, an estimated 43 million tons of copper have been mined but never processed, worth over $2 trillion at today’s prices, creating huge opportunities for anyone who can successfully salvage these riches.
Admittedly, it is not a new concept to reprocess mining waste when technology improves or prices rise. But that just wasn’t possible for some types of ore. And the breakthrough has opportunities far beyond waste landfills – there are millions more tonnes still underground that have not been viable to exploit.
Everything depends on the will of the mining companies to install the Jetti factories. But if the technology is fully adopted by industry, the company estimates that up to 8 million additional tonnes of copper could be produced each year by the 2040s, more than a third of total global mining production. from last year.
“The industry has accumulated this garbage forever,” said Jetti founder and CEO Mike Outwin. “They tried to find an answer on their own for a few decades and couldn’t.”
So far, Jetti’s process has only worked at one mine, in Pinto Valley, Arizona. But the results were so promising that three of the world’s largest copper miners – including BHP – bought stakes in the company. Its last fundraising was valued at $2.5 billion.
Copper giant Freeport has also “initiated a commercial implementation this year at our Baghdad mine in Arizona to test the technology, will evaluate the results and continue the dialogue with Jetti on further collaborative opportunities.”
So what is the problem that Jetti is trying to solve?
There are two main types of copper rocks. The most common type, sulphide ores, are usually crushed, concentrated, and then turned into pure copper in a fire refining process. But this method is not suitable for oxide ores, and the industry’s last big innovation came in the mid-1980s when it adapted an electrochemical process to extract copper from oxide ores, which greatly boosted the ‘supply.
Now Jetti aims to apply its technology to recover copper from a common type of sulphide ore that could not be processed economically by either route – the copper content is too low to justify the cost of refining, while the hard, non-reactive coating prevented the copper from being extracted in the electrochemical or “leaching” process cheaply.
Jetti worked with the University of British Columbia to develop a chemical catalyst that cuts through the layer, so copper can be leached out without the need for high temperatures.
Although Jetti’s process is the most advanced, Rio Tinto says it has also risen to the challenge in lab trials. Rio offers its Nuton technology as a sweetener to the junior mining companies in which it invests: if the junior companies successfully develop their mining projects, then Rio will deploy the Nuton process to increase profitability. He has already signed three such agreements this year.
“When you look at the size of the prize, the potential is huge,” said Adam Burley, who leads the Rio project. “It’s too big to leave on the table.”
Rio wants Nuton to have produced a total of around 500,000 tonnes of copper by the end of this decade, in hopes that the company can one day produce the annual equivalent of one of the top five mines in copper in the world.
Other major miners, including Freeport, Codelco and Antofagasta Plc, have all worked on in-house solutions at their own mines, although so far little information has been disclosed about the success of these projects.
And there are limits to what can be achieved. The focus is on North and South America, and progress will depend on whether the technology can be deployed at major mines.
Yet for BHP, the fact that he is even discussing the future of Escondida, the world’s largest source of copper, with a small upstart is telling.
Negotiations have been ongoing for months, although one sticking point in the talks has been Jetti’s insistence that he set up and operate his own plant at the host mine, according to people familiar with the matter. There are also negotiations on how to share the profits.
Meanwhile, Rio, who is BHP’s junior partner at Escondida, argues that he wants Nuton technology to be considered as well, according to people familiar with the matter.
Jetti and BHP declined to comment on specific negotiations or agreements.
“Jetti is very real. These are not laboratory tests or pilot plants. Jetti has been deployed commercially,’ Outwin said. “Our partners will reap tremendous benefits from being able to use our process, and Jetti will do well.”
—With help from James Attwood and Mark Burton
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