Zim to resume copper mining

18 Jul, 2021 - 00:07 0 Views
Zim to resume copper mining This graph shows the current major copper producers in the world

The Sunday Mail

Martin Kadzere
Zimbabwe plans to resume copper production in 2023 buoyed by firming global prices and rising demand driven by increased capital expenditure on green projects, it has been learnt.

While oil remains a key source of energy, analysts believe the use of copper will play a critical role in replacing internal combustion engine vehicles with electric cars.

In May this year, Goldman Sachs described copper as “the new oil”, suggesting that the mineral is now strategically the most important resource in the commodities mix.

Mr Nick Snowdon of Goldman Sachs Research observed that in the key areas of the green economy — whether electric vehicles, electric vehicle infrastructure, renewables, wind turbines, solar — the use of copper will be much higher than in the current economies.

He warned of a supply side “that is completely under-prepared”.

Zimbabwe last produced copper at Mhangura around 2000 before the mine was closed due to subdued international prices. The depth of the mine increased costs of production.

Copper is currently trading at US$10 000 per tonne — the highest in a decade — on the London Metal Exchange.

In April last year, it was trading at below US$5 000 per tonne, the same price it was selling at in November 2015 and October 2016.

Goldman Sachs has projected the price would hit about US$15 000 per tonne by 2025.

Last week, Cabinet approved the Greater Chinhoyi Copper Development Programme, which plans to operationalise six copper projects by 2023.

An additional three new projects will embark on resource definition.

The Ministry of Mines and Mining Development will be submitting proposals of six projects to be revived, including the retreatment of the Mhangura and Alaska copper dumps, while Angwa Mine in Chinhoyi and Shamrock Mine in Hurungwe will be reopened.

Proposals on the other two yet-to-be-identified projects will be presented in due course, Information, Publicity and Broadcasting Services Minister Monica Mutsvangwa told a post-Cabinet briefing on Tuesday.

Govine Enterprises will partner the Zimbabwe Mining Development (ZMDC) to reopen Shamrock Mine and is expected to resume operations by end of 2022, employing about 4 500 people and generating as much as US$32 million per annum.

Hongua International has entered into a joint venture with ZMDC to reopen Angwa Mine and the Chidzikwe dump, which will be operational by mid-2022, employing an estimated 400 people and generating an about US$33 million per annum.

Zimbabwe plans to boost mineral exports to US$12 billion by 2023.

Currently, gold, platinum, ferrochrome, diamonds and nickel constitute the majority of exports.

Green capex boom

Under the Paris Accord, nearly 200 countries pledged to keep global warming to below 2 Celsius and strive for a ceiling of 1,5 Celsius by 2030 through Nationally Determined Goals (NDGs).

The NDGs are climate action plans or commitment by signatories to the Paris Accord to cut planet-warming emissions over the next decade.

“Well, I think when you look at the Paris Climate goals and, ultimately, the path to net zero emissions, if that’s going to be achieved predominantly via abatement; that is via electrification and renewable energy; then copper is going to be the most critical raw material to achieving that goal because it is the most cost-effective conductive metal. It’s used in capturing, storing, (and) transporting electricity,” said Mr Snowdon.

“But I think the other parallel to oil, and certainly oil in the 2000s, relates to the lack of supply-side preparation for this demand boom. And I think that’s equally important to why we are talking about copper.

“Because I think you have got this very strong green demand story.

“But you also have a supply side that’s completely under-prepared. There is no real investment in new mine projects.

“So, essentially, the copper market is sleepwalking into, you know, a really sizable supply crunch akin to what we saw in the oil market back in the 2000s,” he said.

Zimbabwe recently launched a pilot project for lithium, a critical ingredient in the production of batteries for electric cars.

On Wednesday, the European Union proposed phasing out new petrol and diesel cars from 2035 as it looks to switch to zero-emission electric vehicles as part of its commitment to combat global warming. — ebusinessweekly

Share This: