ButteNewa
Dec 21 2024
By Jim Larson
Thousands of miles from the flooded Berkeley Pit in Butte, Montana lies the Cobre Panama on Panama’s Atlantic coast.
Atlantic Richfield announced in 1983 that its Butte mining operations were shutting down. The Panamanian government announced that it was shutting down the huge Cobre Panama copper mine in November, 2023.
Though the events are widely separated in location and in time, they are symptomatic of an industry that is ill prepared for the surge in demand that knocks at its door, a surge, that if unmet, may negatively impact the world’s economy.
According to a recent report by the Oregon Group, Copper demand will double to fifty million metric tons by 2035. Upgrades to national electricity grids, wind and solar power expansion, and electric vehicle production drive that demand, and none of them will abate in the near future.
Butte’s lone copper producer, Montana Resources, Inc. is positioning itself as best as it can to take advantage of the surge, but it can only do so much.
MRI’s Mike McGivern said he had been hearing about a huge price increase for copper for six or seven years. Today, he noted, that with the growth of green energy,, the increase might realistically happen. The price of copper has exceeded four dollars per pound recently, he said.
Certain areas of the Continental Pit contain greater concentrations of copper, and the company’s engineers try to even out the mine’s output so that they avoid mining 80 million tons of ore one year and 55 million tons the next, McGivern said. Also, to maintain the mine’s structural integrity, the engineers can’t get too “cutesy” with where they blast, he said.
McGivern noted that in 2022 a section of the pit’s wall collapsed. It will take MRI until 2025 to lay that section back to a flatter angle. That, coincidentally, is when the price of copper is set to boom. There is a rich concentration of ore behind the collapsed section.
Regardless of what MRI does, it won’t have much impact on global copper production, McGivern noted.
Copper is abundant. It is sourced from several different countries, and there are large global reserves, the Oregon Group reports. “These are facts that no doubt provide reassurance to the many industries that rely on copper,” the report said. Yet producers, traders, and analysts all warn that a shortfall is coming that Bloomberg argues will stimulate inflation, slow global growth and disrupt global climate targets, the report notes.
Executive Director of the Montana Mining Association, Matt Vincent, noted that as new AI based data centers are built, they too will add to the demand for copper. “It’s an opportunity for domestic mining, and Montana is in the upper echelon of mining,” he said, but he added that the permitting process had to be streamlined. He pointed to the arduous journey that the Black Butte mine has had to navigate obstacles to obtain its permit to mine copper near White Sulphur Springs. That included a trip to the Montana Supreme Court.
Sandfire insists that it can mine in an environmentally responsible way.
Sandfire Vice President for Communications and Government Relations said in an email, “The quest for a sustainable energy future is driving the increased demand for copper. Working together to provide these critical material and minerals in a way that protects the environment is the key to a winning solution for all of us. Sandfire Resources America’s Black Butte Copper project is up to the challenge and looks forward to working towards North American mineral security and showcasing responsible resource management.”
The Montana Environmental Information Center is part of a coalition that has opposed the Sandfire Black Butte mine every step of the way.
MEIC’s Derf Johnson said that the mining industry has exaggerated how large the increase in demand for copper will be. The increase willl be in the single digits, he said. “A lot of that demand can be absorbed by existing permitted mines,” he added.
Asked if he were concerned about the increased demand creating a possible erosion of existing mine regulations, he noted in an email, "We're concerned about any attempts to reduce protections at the state level for mining and its impacts on Montana's people and environment. We want to make darn sure that any projects that are proposed include the people and the environment as part of the equation."
Copper mining has long faced regulatory challenges, and these have often been combined with low prices, but that latter hurdle is quickly dissapearing. As Pat Barkey of Montana’s BBER said earlier this year, “The future is bright for big shove
