Copper is essential to economic activity and the modern technological society with infrastructure developments in major countries and the global trend towards cleaner energy and electric cars to continue to support demand.
In 2024 China will continue to be the dominant influence in copper markets.
At the start of the year there are signs that demand for copper in construction, particularly in the residential sector, will fall but demand from the renewable energy and electric vehicle (EV) sectors will outweigh this.
The liquidation of Chinese property developer Evergrande and numerous other property developers in the country struggling to make repayments, puts further pressure on construction and the country already has a considerable housing supply surplus.
Growth areas
On the flipside, the renewable energy and EV markets in China, and around the world, continue to expand and with copper a major input metal in both markets, there is increasing demand.
EVs use an estimated 3.5-4 times more copper than their internal combustion engine (ICE) counterparts and with copper still being the most efficient conveyor of energy, demand for the metal in renewable energy initiatives is growing.
Again, China is important as Chinese-made EVs are, on average, a fifth cheaper than EU-made EVs and also considerably cheaper than those from the US. The discounted price not only gives China a competitive advantage within the global marketplace but also supports the widespread adoption of EVs globally, as price is a leading factor in consumer purchases.
Tightening supply
In its Energy Transition Materials Monthly report, Sprott said that copper supply troubles threatened the renewable energy industry’s ability to meet the staggering projections for long-term demand as the cumulative demand estimated for copper through 2050 was greater than the total amount produced in all of human history.
Sprott believes that meeting this demand will require massive upfront investment as well as higher inventive prices for the next generation of mines.
There are signs of tightening with the indefinite suspension of First Quantum’s Cobre Panama copper mine and other major copper miners, including Anglo American and Vale, lowering their copper output guidance for 2024 supplies.
A number of smaller mines are set to begin operations this year while expansion projects at others are also on the cards and copper recycling remains a strong source.
Price forecast
BMI, a Fitch Solutions company, maintains its 2024 average annual copper price forecast at US$8,800/tonne, above the 2023 average on the back of a decline in US dollar strength and supply constraints.
Although it expects prices to improve slightly in 2024, it notes that weaker demand from China and a limited growth outlook across major markets will place a cap on prices, tilting the balance of risks to the downside.
Copper small caps make moves
Let’s take a look at some of the ASX-listed copper plays that made progress during the December quarter of 2023.
FireFly Metals
The December quarter may prove transformational for FireFly Metals Ltd (ASX:FFM) with the completion of the Green Bay Copper-Gold Project acquisition in Newfoundland, Canada.
The project has a resource of 39.2 million tonnes at 2.1% for 811,000 tonnes copper equivalent and FireFly is off to a flying start in its quest to boost this with assays of up to 19.4% copper equivalent in its first drilling campaign.
READ: FireFly Metals hits up to 19.4% copper equivalent at Green Bay Copper-Gold Project, Canada
These results were the first from an ongoing 40,000-metre underground diamond drilling program and a 700-metre development drive, which have extended known mineralisation by 350 metres and will form part of a resource update for Green Bay.
Other developments during the quarter included the acquisition of 169 square kilometres of additional ground adjacent to Green Bay and the completion of a share purchase plan which was increased to $5 million.
Managing director Steve Parsons said: “We seized what was a rare and valuable opportunity to acquire a copper project of Green Bay’s quality.
“Our technical skills, experience and network meant we were able to move quickly and effectively through the due diligence and funding phase to ensure we secured this outstanding asset.
“We were attracted to the substantial resource, high-grade mineralisation and existing infrastructure and we saw huge scope to grow the resource through drilling.
“The first results from our drilling program fully support our assessment of the project and view of its potential.
“Drilling will continue to accelerate with the use of the new underground platform and a second rig arriving on site. This will maximise our ability to generate strong news flow and grow the known mineralisation ahead of a resource update.”
Far East Gold
The Woyla Copper-Gold Project, covering 24,260 hectares in North Sumatra, Indonesia, represents a strategic focus for Far East Gold Ltd (ASX:FEG, OTC:FEGDF) as it continues to explore and develop its potential for significant copper and gold resources.
The company, with a portfolio across Australia and Indonesia, holds a 51% interest in the project, which stands to increase to 80% upon completion of a feasibility study and definition of a maiden JORC resource estimate.
READ: Far East Gold extends Woyla drill campaign following strong gold and silver assays
In the company’s opinion, Woyla is one of the most highly prospective undrilled copper-gold projects in South East Asia with the potential to host high-grade epithermal and porphyry deposits.
The company continues to drill test vein targets within the Rek Rinti prospect area at the Agam zone and define drill targets within the 6-kilometre structural corridor extending south to Aloe Rek prospect.
During the quarter, the company evaluated priority areas selected for the planned scout drilling program, which is expected in the current quarter.
Initial field mapping was completed at planned drill targets at the Sentul and Buluroto epithermal vein prospect areas and at the Singgahan and Jerambah porphyry prospect areas.
A surface grab sample collected from Sentul returned 0.84% copper with 1.6 g/t gold and 79 g/t silver while another result was 7.1 g/t gold, 161 g/t silver and 0.32% copper.
Helix Resources
Helix Resources Ltd (ASX:HLX) has a strong position in the base metals-rich Cobar-Nyngan area of central NSW with a large landholding, existing copper deposits and ongoing drilling success at new targets that point to increased resources.
READ: Helix Resources has “bases loaded” with copper targets; confident of “scoring runs”
In the December quarter, the company made a discovery at Bijoux prospect with results of 36 metres at 0.99% copper from 41 metres including 6 metres at 1.99% from 62 metres in the oxide zone and 10 metres at 1.48% copper from 182 metres including 2 metres at 5.76% from 184 metres.
Drilling since then has continued to produce promising signs from Bijoux.
The company’s target generation program also produced results of up to 2 metres at 1.44% copper within 8 metres at 0.63% from 76 metres at Black Range while preliminary geochemical results and regional scale mapping identified a new prospective copper trend, the Mount Lewis Trend.
Helix executive chair Mike Rosenstreich said: “Adding copper tonnes to our existing Canbelego mineral resource – ideally in ‘big bites’ through new discoveries is the strategy Helix is focused on to generate shareholder value.
"To that end, the Helix team has been working its large regional tenement position in the highly fertile Cobar copper district, to establish a compelling pipeline of copper-gold targets to test.
"I believe we are now poised for that ‘new discovery’ phase based on the volume and quality of the regional targeting results we have compiled and interpreted over the past 24 months.
"From a geological understanding and targets perspective we started with a largely blank piece of paper – with a few ‘stars and crosses’ highlighting various isolated historic prospects and mines.
"Now – that sheet is a ‘Jackson Pollock’ full of geological texture and structural trends, from the geophysical, geomapping and geochemical sampling work – coming to fruition with numerous, new high priority targets emerging.”
Celsius Resources
Celsius Resources Ltd (ASX:CLA, AIM:CLA) is advancing a portfolio of copper-dominant projects that, in production, would help support the continued electrification of global economies to reduce the emission of greenhouse gases with most of its exploration focus in the Philippines.
During the December quarter, the primary focus was on Sagay Copper Project on the Island of Negros at which an application for Declaration of Mining Project Feasibility was a highlight.
Subsequently, Celsius produced an updated JORC mineral resource estimate for Sagay with the combined measured, indicated and inferred mineral resource at 312 million tonnes grading 0.39% copper and 0.11 g/t gold for around 1.2 million tonnes of contained copper and 1 million ounces of contained gold.
Managing director Peter Hume said: “The greater definition of the shallow supergene copper at Sagay has increased both the resource category and our own confidence in the ability to look at a new shallow sustainable friendly development option.
“The previous mineral resource only placed this area in the inferred category and with this new update to the mineral resource, this area is now largely in the measured and indicated category, which allowed us to complete and submit a feasibility study to the Philippine Government."
At the flagship MCB Project on the island of Luzon, 320 kilometres north of Manila, the company is waiting for the issuance of a mining permit and ground activities in the quarter were kept to a minimum while preparing for the pre-development phase.
Included in the preparation is the signing of an agreement with the Provincial Government Unit of Kalinga to jointly develop the road alignment for the MCB Project’s access from mine site to port.
Meanwhile, in Namibia the company had the licence for the Opuwo Cobalt Project renewed for two more years.
C29 Metals
Copper is the focus of C29 Metals Ltd (ASX:C29) at its projects in the copper hotspots of northwest Queensland and central NSW.
During the quarter, the company’s maiden RC drill program continued at Mayfield Copper-Gold Project in the world-class eastern fold belt of the Proterozoic Mount Isa Inlier with the program resuming in mid-January.
READ: C29 Metals has RC drill spinning in maiden program seeking copper-gold at Mayfield
Two of five completed holes intersected substantial widths of visible chalcopyrite mineralisation within larger ‘redrock’ alteration halo typically associated with local IOCG systems.
The presence of significant chalcopyrite intervals in two separate settings at Mayfield was considered extremely encouraging in respect of initial drill testing of large mineralising systems with likely extensive vertical extent.
In NSW, C29 has completed an airborne versatile time domain electromagnetic (VTEM) and aeromagnetic survey and an IP survey at Sampsons Tank within the highly mineralised Girilambone District of the Lachlan Fold Belt.
This district hosts a number of massive sulphide deposits such as the Tritton Copper Mine of Aeris Resources, the Collerina CZ copper-gold discovery of Helix Resources and the Tottenham copper-gold deposit of Locksley Resources.
At Reedy Creek in Central West NSW, between the world-class Cadia and North Parkes porphyry gold-copper mines, C29 completed 1,060 metres of initial drilling of targets with broad intervals of copper, lead, zinc and gold anomalism observed from shallow depth.
C29 is also carrying out preliminary fieldwork at Stadlers Copper Project, 60 kilometres south of Paraburdoo in the Ashburton Basin of WA and is reviewing available historical data to focus upcoming desktop and groundwork on the Torrens Project in central South Australia.
Cooper Metals
After receiving more strong results at the flagship Mt Isa East Copper-Gold Project in northwest Queensland during the quarter, Cooper Metals Ltd (ASX:CPM) has a firm foundation to achieve further success in 2024.
Mt Isa East covers 1,637 square kilometres with numerous historical copper-gold workings and prospects identified for immediate follow-up exploration.
A number of new prospects, including Brumby Ridge, Raven and Mafic Sweats South, have provided further signs of the discovery potential with the former emerging strongly after RC drilling produced bonanza-grade copper.
READ: Cooper Metals has solid foundation to achieve further Mt Isa East copper success in 2024
Cooper Metals managing director Ian Warland said: “The Brumby Ridge copper-gold discovery has been an exciting outcome of initial scout drilling completed during the quarter and validation of the prospectivity of the Mt Isa East Copper-Gold Project.
"We also intercepted significant copper-gold mineralisation at the Raven and Mafic Sweats South prospects.
"These excellent drill results set the company up well for an exciting 2024 where our focus will be assessing the size and grade potential of these new discoveries while also continuing to test our extensive pipeline of copper-gold targets.”
Cyprium Metals
Cyprium Metals Ltd (ASX:CYM, OTC:CYPMF) is making steady progress towards the restart of the Nifty Copper Project in Western Australia as a long-life large-scale open pit mine, targeting first cashflow within two years.
Nifty, which was discovered by WMC in 1981 and started operation in 1993 as an open-pit oxide copper mine, is on the western edge of the Great Sandy Desert in the northeastern Pilbara.
Cyprium’s development strategy includes the integration of a copper oxide starter open pit operation that will be complemented by the larger scale sulphide open pit, which together is expected to provide a significant +15-year mine life based on +900,000 tonnes contained copper mineral resource.
Managing director Clive Donner said: "We have accomplished a lot in the past quarter and I am very excited by the potential opportunities we are uncovering as we progress our restart plans.
"Our focus during the quarter was to transition the company as quickly as possible to the proposed restart strategy of the larger integrated pit.
"This involved the early integration of the new management team into the various workstreams and the formal engagement of MEC Mining to provide external capability to assist us in undertaking the resource update, geotechnical and mine planning work streams.
"The revised board has been very active and helpful in assisting the company with its short-term goals and I am very pleased with the sense of urgency displayed by the management team to advance all the work streams.
"Following a positive outcome of the feasibility work, the company plans to work toward the delivery of a DFS during the year."
Aeris Resources
Multi-state producer Aeris Resources Ltd (ASX:AIS, OTC:ARSRF) achieved copper equivalent production of 9,700 tonnes for the quarter at an AISC of A$5.40/pound.
At the Tritton Copper Operations in central NSW, performance was impacted by skilled labour and equipment availability and delayed ramp-up of production from Avoca Tank mine.
As a result, copper, gold and silver production was below plan with total copper production of 4,800 tonnes at an improved AISC of A$5.37/pound while operating costs were under control.
A highlight was an updated mineral resource estimate (MRE) for Avoca Tank with copper grade increased by 35% and contained copper metal by 16%.
During the quarter, a drill program at Constellation deposit was completed with assays from the final three drill holes received.
READ: Aeris Resources hits up to 2.34% copper at Tritton’s Constellation deposit; confirms extension
Five of the six holes intersected copper mineralisation, extending the known sulphide mineralisation 100 metres along strike and 200 metres down-plunge of the current MRE.
At Cracow Gold Project in Queensland, production of 11,100 ounces at an AISC of A$2,407/ounce was in line with plan.
Operating and capital costs are on track and the tailings dam lift was completed in January, ahead of schedule and under budget, extending the life of the operation.
In North Queensland, mining operations at Mt Colin are ahead of plan due to a strong performance from the ‘cave’ zone material.
Only one of the two processing runs originally scheduled was completed resulting in copper production by a third-party being significantly below plan at 1,600 tonnes at an AISC of $5.38/pound.
There were ore stockpiles at the mine site and the third-party processing facility of 133,000 tonnes at quarter-end yet to be processed.
READ: Aeris Resources progresses Stockman feasibility study; "excited with potential"
Feasibility study and permitting activities continued during the quarter at Stockman Copper Project in Victoria and new resource estimates were released for Currawong and Wilga deposits, increasing total tonnes by 7% and total contained copper by 6%.
The feasibility study is well advanced with a mine plan involving +12 years of ore production from just the Currawong deposit at 850,000 tonnes per annum rate. This simplified plan reduces operational risk and reduces upfront capital costs.
All primary approvals for mining and onsite processing are in place and the project has strong community support.
READ: Aeris Resources beefs up copper-gold war chest from A$30 million equity raising
In November 2023, Aeris undertook a $30 million fully underwritten equity raise, comprising a $13.9 million institutional placement and a $16.2 million accelerated non-renounceable entitlement offer.
QMines
QMines Ltd (ASX:QML) is a Queensland-based copper and gold exploration and development company seeking to become Australia’s first zero-carbon copper and gold developer.
The company owns or has rights to 100% interest in two advanced projects covering a total area of approximately 604 square kilometres with its flagship project, Mt Chalmers, being 17 kilometres northeast of Rockhampton.
READ: QMines identifies six new massive sulphide targets at Mt Chalmers
QMines’ fifth MRE for Mt Chalmers resulted in a new combined total of 15.1 million tonnes at 1.3% copper equivalent (CuEq) for 195,800 tonnes of contained metal.
Drilling during the quarter at the Artillery Road prospect delivered strong results pointing to a base metal skarn discovery measuring 1,400 metres long by 500 metres wide with an average thickness of 15 metres.
READ: QMines hits up to 1% copper and 5.1% zinc at Artillery Road, Mt Chalmers Project
Results included:
- 23 metres at 0.56% CuEq from 205 metres, including 5 metres at 0.82% from 223 metres;
- 15 metres at 1.01% CuEq from 219 metres, including 5 metres at 1.46% from 220 metres; and
- 4 metres at 0.90% CuEq from 250 metres.
Drilling at the VT04-Screamer prospect was completed and a geophysical inversion study was also completed with six new EM targets identified.
Significant progress was made on a pre-feasibility study with activities accelerating over the northern Australia wet season when the company shut down exploration and resource drilling operations. This is scheduled to be delivered during the June quarter of 2024.