OZ Minerals chief executive Andrew Cole is reportedly confident in the long-term fundamentals for copper, as the company moved ahead with the $916 million expansion of its Carrapateena copper and gold mine in South Australia.
The OZ Minerals board last week approved the Carrapateena development after a feasibility study update increased the calculated ore reserve at the site by 13% to 79 million tonnes, with copper equivalent grade of 2.31%.
The company can fund the development with cash on hand, along with expected cash flow from the Prominent Hill Project.
Cole spoke with the AFR this week and said the company feels demand for copper will remain robust, thanks to its importance in electronics, appliances and the booming electric car market.
OZ Minerals is also in a unique position to expand copper production, he explained.
“The barrier to entry on copper is very high,” Cole was quoted as saying.
“We’re confident in the long-term fundamentals of copper, both from a supply and demand view.”
In the company’s Carrapateena announcement last week, Cole said the company was confident in the “economics, constructability and operability” of the project, which is 160 kilometres north of Port Augusta in South Australia.
“Carrapateena is now firmly established as a high quality project in its own right with opportunities including expanding the existing cave footprint and accessing satellite deposits. It also serves as a base for potential district development of nearby Fremantle Doctor and Khamsin.
“These future expansion options have been enabled by the improved mine design, but remain as upside to the current valuation.”