Copper mines around the world are being revived as expectations of a structural shortage of the industrial metal grow. Consultancy Benchmark Mineral Intelligence is tracking nearly a million tons of potential annual copper production from mine restarts by 2030, which is over 4% of current output. Among the mines being restarted is the Mt Lyell mine in Tasmania, which was idle for 12 years before owner Sibanye-Stillwater approved its restart. The company expects to spend around $340 million to restart the mine, with plans to ramp up to 26,000 tons of annual production after it comes back online in 2029.
Record prices, with the benchmark London Metal Exchange copper contract hitting $14,875 a ton in September, have made some idled mines viable again. However, it is the prospect of medium- to long-term shortages that is prompting operators to restart them. Craig Lang, principal analyst at CRU, said that while these operations are relatively small, they can make an important contribution to bridging the copper mine supply gap over the medium term.
Global copper demand is projected to rise 50% to 42 million tons a year by 2040, driven by the energy transition and data centers. S&P Global Energy predicts that nearly half of new mine supply will come from restarts and expansions of existing resources. However, even then, the market could face a structural shortfall of 10 million tons. Eillen Grace Dela Cruz, principal analyst at S&P Global Energy, said that brownfield additions can buy the market valuable time, but they cannot replace the need for brand-new, world-class tier-1 discoveries to satisfy that scale of demand.
Potential hurdles abound for some of these plans, such as flooding, run-down plants, outdated tailings dams, protesters, and stricter environmental rules. Charles Cooper, head of copper research at Wood Mackenzie, said that a dormant mine is not simply waiting for someone to turn the power back on. The key question is why the mine closed in the first place. The pool of viable restart candidates is relatively small, and output from revived mines averages around 33,000 tons a year, according to Wood Mackenzie’s historical analysis.