Mergers and acquisitions (M&A) activity is heating up in the Copper Mining sector, as companies race to secure reliable sources of copper to meet the soaring demand from the renewable energy industry. With copper being a crucial component in electric vehicles (EVs), wind turbines, solar panels, and power networks, it is an essential part of the transition to a green economy.
The growing demand for copper is also driven by the increasing adoption of EVs, which require more copper than conventional vehicles due to their electric motors and batteries. In addition, the use of copper in wind turbines and solar panels is expected to increase as these technologies become more widespread. With the shift to renewable energy sources accelerating, the demand for copper is likely to remain strong in the years to come.
According to the International Energy Agency (IEA), copper consumption could surge by up to 40% by 2040, as various governments pursue their Net Zero objectives to reduce greenhouse gas emissions. This has prompted mining companies to ramp up their production and expand their operations through acquisitions and mergers.
Teck Resources announced in February 2023 that it would divide its steelmaking coal segment into Teck Metals and Elk Valley Resources. Teck Metals will run and develop its base metals operations, including copper mines in Chile and British Columbia, zinc mines in Alaska and Chile, lead-zinc smelters in Trail, British Columbia, and copper possibilities in Chile and Peru.
Glencore, a Swiss mining company, made an unsolicited $22.5 billion offer to buy Teck Resources, mostly in shares and up to $8.2 billion in cash.
According to Freeport-McMoran, the world’s biggest publicly traded producer, Glencore Plc’s proposed $23 billion buyout of Teck Resources Ltd. is part of a copper consolidation trend that will yield additional mergers as investors want growth in an industry struggling to tap fresh deposits.
After the split, at least six companies, including Anglo American, Freeport-McMoRan, and Vale, have approached Teck about acquiring the base metals company.
On April 13, 2023, Hudbay Minerals, a Canadian miner with operations in Canada, Peru, and the US, announced a formal agreement to acquire Copper Mountain Mining Corporation, a Canadian miner with operations in Australia and British Columbia, for $439 million.
Lundin Mining, a Canadian base metal mining operator, inked a purchase agreement to buy 51% of the Caserones copper mine in Chile from JX Nippon Mining & Metals Corporation, a unit of ENEOS Holdings, Inc., for US$950 million.
Developing a Copper Project in Mining-Friendly British Columbia, Canada
New Energy Metals’ (TSXV:ENRG) (OTC:NEMCF) Troitsa Copper Project consists of mineral claims covering an area rich in porphyry copper-type deposits, containing metals such as copper, gold, and silver.
According to a recently completed NI 43-101 Technical Report, the Troitsa Copper Project’s Main Zone has found many lengthy copper intersections, with mineralization extending at least 5 km by 2 km and containing copper, molybdenum, gold, and silver.
Higher-grade porphyry geological formations have been discovered inside the Main Zone, with notable intersections including 14m at 0.63% copper, 19m at 0.65% copper, and 25m at 0.71% copper. In comparison, the feed grade of Copper Mountain’s flagship mine was substantially lower, at 0.24% copper in Q4 2022.
In February, New Energy Metals announced that the TSX Venture Exchange had accepted the Troitsa Copper Project option agreement in response to its news release dated September 7, 2022. The Company may earn a 100% interest in the Troitsa Copper Project by making $220,000 in cash payments and issuing 1,200,000 common shares over a three-year period, as well as completing $5,000 in staking or similar acquisition within the Area of Interest, as defined in the Agreement, within 12 months of the Agreement’s execution date.
New Energy Metals also recently acquired a Lithium Project in Ontario.
On March 1, New Energy Metals announced the approval of its Roslyn Lithium Project through an Assignment and Assumption Agreement with an arm’s length party dated December 6, 2022.
The Roslyn Lithium Project, located 50 kilometers northeast of Nipigon in Northwestern Ontario, is made up of 12 claims (254 cells) totaling approximately 5,100 hectares. Under the provisions of the Agreement, the Assignor assigns and transfers to the Company the right to acquire a 100% interest in the Roslyn Lithium Project.
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