Domestic "red metal" critical to America's clean energy future

The United States and China are battling to secure stakes in copper mines around the world, and the stakes have never been higher. In a clash of titans, America and its free-market economy values compete against the Asian superpower with its stranglehold on copper resources and processing.

With copper, the "red metal" critical to America's clean energy future, it's time to focus on developing domestic assets and amping up the country's process engineering.

"We are in a second Cold War," said Brian Menell, CEO of TechMet, in a Wall Street Journal article titled, Why the World has Gone Cuckoo for Copper. "It is a competition between Western values and dictatorship."

The Biden administration's announcement requiring increased tariffs for Chinese goods under Section 301 will boost domestic copper production and imports from geopolitically friendly nations, reducing reliance on China. But America clearly has some catching up to do to compete on a level playing field with China.

"The twilight of domestic American process engineering is the major impediment to a secure domestic supply of critical minerals, refined metals, alloys, fine chemicals and the manufactured items dependent on them," says Jack Lifton, Co-Chairman of the Critical Minerals Institute.

Moving mineral processing to the 'front burner'

With the mass production of rare earth minerals and magnets moved from the United States to China in the 1970s, America needs to put the processing of minerals and the development of its own assets on the front burner.

Lifton, who coined the term "technology metals" in 2007 to describe those metals whose properties enable the miniaturization of electronic technologies, says that today, "China's process engineering is where America was at the height of the Cold War era."

"There can be no domestic American self-sufficiency or security of supply of raw materials and their processing without a dedicated program to understand the problem and a dedicated plan to solve it," says Lifton.

While China is eating America's technology metals lunch today, the superpower takes few environmental safeguards in their mineral processing. America is primed to take its metals processing mantle back to process and produce minerals in an expeditious and environmentally responsible manner.

Arizona is U.S. leader in copper deposits

According to GlobalData's mines and projects database, there are over 709 copper mines operating globally, with 28 in the U.S.

The largest U.S. copper producer is Freeport-McMoRan, with four formidable domestic copper assets – the Bagdad, Morenci, Safford and Sieritta mines – all in the state of Arizona, which has the largest cluster of copper deposits in the United States.

Courtesy of Vorticom

Native copper from Arizona.

Arizona is the seventh-best global jurisdiction for mining, according to the Fraser Institute, and the state produces 71% of the United States' total copper output. With the current copper supply deficit, it is likely that short-term solutions to the crisis will come from smaller, more efficient copper operations that are less expensive to build and have less environmental impact.

World Copper's Zonia mine in Arizona fits into the new copper market dynamics, perfectly offering a lower-cost operation that can be permitted and constructed in half the time required on average to develop new mines.

The alternative to geopolitically-friendly copper mines and mineral processing is no mines but Chinese-run mines and minerals processing with lax environmental regulations.

Author Bio

Gordon Neal is President, CEO and Director of World Copper (TSX.V: WCU | OTCQB: WCUFF), a Canadian resource company focused on its flagship Zonia Copper Oxide Project in central Arizona. He previously served as CEO and Director of Tincorp Metals, President of New Pacific Metals Corp., and V.P., Corporate Development at Silvercorp Metals. In the past 20 years, he has raised over $500M in the resource sector.