Asiamet Resources Ltd (LON:ARS) believes it is well placed to benefit from the current uptick in demand for copper.
In his annual statement for the 2020 financial year, chairman Tony Manini said copper supply will not meet demand in the foreseeable future, with most market analysts suggesting that the gap between supply and demand is widening and predicting a prolonged period of strong prices.
READ: Asiamet’s new general manager Andrew Neale confident of rapid progress
Many of the major economies are planning large infrastructure-related development programs focussed on decarbonisation and the transition to renewable energy and electrification of transport.
Copper is expected to be a major beneficiary of these policies as the energy transition will require significant additional supply over and above the current baseload requirements, Manini said.
This anticipated surge in demand comes at a time when supply is likely to be constrained due to prolonged underinvestment in exploration and new mine development, he added.
Indonesia-focused Asiamet has projects in development at BKM, where it is awaiting a final permit, and the earlier-stage Beutong where field studies are scheduled to start this year.
Some metallurgical test work to better understand the development optionality for the project is also planned.
Last year, Asiamet relocated the corporate head office from Melbourne to Jakarta as it moves into the development phase of the BKM Project.
In the year to 31 December 2020, Asiamet posted a total loss of US$4mln from US$7mln in 2019 and concluded the period with US$1mln in cash. It has since raised US$14mln through a placing in February.
Shares rose 1% to 2.35p on Monday before close.