Mining executive John Antwi, president and director of privately held Elim Mining, spoke about the copper market on the third day of The Northern Miner’s Global Mining Symposium.
Antwi and his team at Elim Mining are advancing the company’s flagship Cactus copper project in Arizona and plan to make a construction decision in 2022.
The project, which hosts the past-producing Cactus mine, was brought to Antwi’s attention due to his 26-year track record of identifying interesting geological opportunities.
In a wide-ranging interview with Northern Miner group publisher Anthony Vaccaro, Antwi began by talking about his career in mining. After getting a bachelor’s degree in geological engineering in Ghana, Antwi provided geological services to a gold mining company for about thirteen years in West Africa. He then moved to the United States, where he completed a master’s degree in mineral economics at the Colorado School of Mines, before joining Newmont (TSX: NGT; NYSE: NEM).
At Newmont, one of his roles was to help the company identify new opportunities, and Antwi was instrumental in its 2011 US$2.3 billion acquisition of Nevada-focused Fronteer Gold and its Long Canyon development project. “I made the case for Long Canyon,” Antwi tells Vaccaro, “and I believe Newmont won’t regret making that acquisition.”
After Newmont, Antwi joined Klondex Mines as senior vice president for corporate development and planning, until its acquisition by Hecla Mining in July 2018.
Now his focus is on Elim Mining’s copper projects, and he believes the company’s timing will be just right, with elevated copper prices on high demand, the global pandemic, ageing copper assets, and looming supply gaps.
The Cactus mine, formerly known as the Sacaton mine, was discovered in the 1960s by American Smelting and Refining Co. (ASARCO), from a mineral outcrop immediately to the northeast of its future open pit operation, which today spans 3,000 feet in diameter and runs 980 metres deep. The mine was in production from 1972 until 1984, but eventually shut down due to poor economic conditions.
Antwi and his team at Elim are confident that they can put the mine back into production and find more resources along the Santa Cruz trend, where it also owns the adjacent Parks-Salyer property. According to Elim, ASARCO conducted exploration that revealed a copper-porphyry system running north-east and southwest from the Cactus mine and over the company’s Parks-Salyer ground.
Antwi told Vaccaro that he expects the copper price will remain at current levels of about US$3 per lb. due to a number of factors, which of course include the global pandemic, which has slowed copper mining operations in South America, most notably in Chile and Peru.
“South America contributes about 50% of the global supply of copper and that is very critical because any impact there can have a significant impact on price,” Antwi says. Other factors driving the copper price include a strong economic rebound in China during the second quarter.
Beyond demand from China, Antwi says, is the trend across the global economy towards greener industries and increasing demand for electric vehicles and a move away from traditional sources of energy, all of which will require more copper. “You will see in the short term a lot of economies will be focused on trying to transition from these fossil fuel generated energy sources to other sources,” he says.
Antwi also said he agrees with those like company builder Robert Friedland, who believe that copper’s anti-microbial properties will become increasingly important and that surfaces coated in copper in hospitals will eventually replace stainless steel, although he cautioned the industry needs to “get creative” in order to find new and cheaper processing methods to reduce costs.
When asked if higher copper prices were sustainable, he replied with an emphatic “yes.”
While countries like Indonesia are looking to increase their copper production over the next five years, he noted, and there are also potential additional sources of the metal in Africa, there are also many copper mines in South America that are ageing out. “It’s a function that they’ve been in operation for so long, and at a certain point it becomes a challenge keeping grades at the level where they started,” he said.
Elim Mining completed its acquisition of the Cactus project in July and started resource development drilling in August. The drill program will evaluate the open pit layback opportunity at Cactus West and the potential for underground or open-pit mining at Cactus East. It expects to complete a resource estimate and preliminary economic assessment by the second quarter of 2021.
ASARCO operated a 9,000-tonne-per-day open pit and sulphide flotation mill on the west deposit over 12 years, processing 38 million tonnes and producing 398 million lb. copper, 1.4 million oz. silver and 30,000 oz. gold. Copper recoveries from the mill came in at about 87%. In addition, ASARCO completed a feasibility study, constructed a vent raise and production shaft and began underground development to access the Cactus East orebody prior to low copper prices forcing the operation to shut down.
Antwi believes that modern heap leaching with solvent extraction-electrowinning metallurgical processing may offer economic advantages by processing oxide and supergene enriched sulphide ore at Cactus compared to ASARCO’s sulphide-only flotation mill-based operations.
“They mined copper, moly, gold and silver, and they had a flotation processing, and one of the things they missed … is they didn’t consider oxide and leaching, so that’s the benefit we get here,” he says.
“I had the right team to come in and do the due diligence, and we had the right support from the board that we put together and started talking to investors and the timing was just right. So it was a combination of having the right assets and seeing an opportunity that if you can manage your costs well … these are long-term production profiles … and Arizona as you know, is copper country, so it was all strategic and it all fit together.”