Calibrating the necessity of sustainable copper production with heightened global demand.
The Department for Energy and Mining’s Copper to the World conference has become established as one of the world’s leading annual copper events, delivering unique copper insights from voices across the Australian and global copper market. This year’s event shone a spotlight on copper’s importance to a decarbonised future, the emerging environmental, social and governance (ESG) criteria, data transformation in the copper sector and how this trend is impacting value creation through the supply chain.
While the shorter term may be challenging, medium-term to long-term term copper demand will increase significantly in line with global demand for decarbonisation. How this increased demand coupled with increased copper production environmental, social and governance (ESG) expectations will be achieved is a key issue facing the industry. These were some of the key takeaways from Copper to the World 2022.
Speaking at the event, Bloomberg Senior Metals Analyst, Yi Zhu, said copper demand, arising from clean energy technologies, may double by 2030 versus 2020 levels. This would be an increase of 2.5 million tons to about 5 million tons by 2030. Tim Gerrard, Portfolio Manager at Janus Henderson Investors, also highlighted the significant demand increases copper will see over the next decade, driven mainly from the electric vehicle (EV) market. ‘A conventional ICE [internal combustion engine] vehicle uses approximately 25 kilograms of copper while an EV uses approximately 90. That change is going to have a major impact on demand,’ he said. Tim went on to say that while it is a positive and necessary evolution, ESG may have a material impact on supply, which could lead the drive to potential substitutions and greater copper recycling.
Andrea Vaccari, Director Responsible Production Frameworks & Sustainability, Freeport-McMoRan, emphasised that efforts to meet increased copper demand must not come at the cost of sustainability. But she added this need not be a zero-sum game, stating that copper miners, and miners in general, with higher ESG performance tend to be more sustainable and more stable, offering better returns to shareholders.
Both Tim and Andrea reiterated the fundamental need for copper miners to play a constructive role in reducing carbon emissions. Talking about the Janus Henderson investment approach, Tim said ‘... we want management that understand the urgency around climate change, and we want to see measurable outcomes around ESG in areas such as water security.’ At the company level, Andrea outlined how Freeport McMoRan is addressing the climate change challenge through an approach based on three pillars: reducing greenhouse gas emissions; enhancing resilience to climate change risks; and contributing responsibly produced copper to the global energy transition. On priorities through to 2030, Andrea also specifically highlighted the company’s focus on renewable energy sourcing. ‘Over the next seven to eight years we are really looking at securing renewable power purchase agreements for our sites while also advancing electrification,’ she said. Finally, over the coming decade and beyond, she emphasised Freeport’s engagement with innovation, and the role, as yet not completely defined, that innovation will play in creating more efficient, less carbon intensive mines. On this point Andrea highlighted how the company is actively leveraging existing strategic partnerships with Caterpillar and Komatsu and other original equipment manufacturers to better understand emissions goals and objectives for haulage and to find opportunities for collaboration.
On the issue of big data, Dr Rohin Wood, Managing Director and Partner, Boston Consulting Group, an expert in artificial intelligence (AI) application discussed how mining was increasingly embracing the potential of AI. Rohin said, ‘It might be a bit behind the curve but we’re getting there. I can see real opportunities for AI in mining, we’re looking at area such as fixed plant optimisation and also the support of team decision-making at large integrated operations.’ Rohin also observed that AI can be attractive for a sector with usually high capital expenditure. ‘AI doesn’t need a lot of capital. And well posed AI models can generate accurate predictions and can unlock significant value via experimentation,’ he said.
Finally on innovation, both Andrea and Rohin highlighted the emerging role of digital twinning in mining and the obvious use-cases for the technology when it comes to optimising operational efficiencies and sustainable production.
The event was opened by the Hon Tom Koutsantonis MP, Minister for Energy and Mining, Government of South Australia. South Australia is Australia’s foremost copper mining region hosting world-class copper assets including Olympic Dam and Carrapateena. Minister Koutsantonis echoed the sentiment of the other speakers when observing copper demand is being driven by the carbon neutral transition. He highlighted how government is collaborating and supporting copper miners in South Australia to meet that global demand.
Watch the Copper to the World presentations on the Energy and Mining SA YouTube channel
More about Copper to the World
Expanding with Austmine
In an exciting move, the Department of Energy and Mining has established a partnership with Austmine to run future Copper to the World conferences. While retaining a focus of giving unique insights and updates from voices across the copper market, the partnership will allow it to reach a larger audience and bring a fresh approach. Delegates, speakers and South Australia will benefit from a broader platform to educate, collaborate and innovate.
Copper to the World 2023 will be held immediately before the Austmine 2023 International Conference and Exhibition in Adelaide from 9–11 May 2023 at the Adelaide Convention Centre.
This is the first time since 2009 that the Austmine International Conference and Exhibition will be held in Adelaide. We encourage you to be part of both events, and take advantage of this unique opportunity to widen your learning and develop networks for the future success of the exploration and mining industry.
Get more details on Austmine 23 and Copper to the World 2023 as they become available
– July 2022