Copper to Reach $9,500 Per Ton

Let's talk about copper, because youtake a look at the price of copper were around $83,000 or so.We know that we've seen plenty of supply shocks in this market and it feels likethe price has barely budged. Does this come down to a demand story?Goldman Sachs is just published today calling for over $9,000 a tonne copperthis year. We think copper is making a bottom.I'd be willing to wager on 9500 a tonne before you go down to 7500 a tonne.The the physical market is very, very tight and now in deficit and with theFed likely to cut rates, the dollar denominated price of copper is likely togo up a lot this year by the middle of.

The year.Well, let's let's talk about China, because I don't need to tell you that alot of the bearish cases for copper, they really come back to sluggishChinese demand. How does that factor into your prettybullish view here? It's not true.China consume more copper last year than any year before.So Chinese demand is still very strong. Everybody knows about the weak realestate market in China, which is probably 20 to 25% of their economy.Military demand, national security demand.Demand for militarisation is very high.

And so physical offtake is very strongand inventories are extremely low. So really, this is like a powder kegready to explode as soon as the Fed cuts rates in the second half.So a red herring on the Chinese demand. Forget about the Chinese demand.There's India is growing. Europe is growing.The rest of the world is growing. And the demand for ESG and the greeningof the world economy remains very strong.All right. I'm going to forget about it for atleast a couple of minutes. Let's talk about $15,000, because youjoined BTV last month.

You made waves by saying that we need acopper price of $15,000 a tonne to really stimulate and sustain newinvestment in copper mines. Of course, copper is at almost half ofthat price today. What is the road to 15,000 look like?What do we need to happen? We've seen molybdenum go from a dollar apound of $30 a pound. We see metals go crazy when you needthem. If somebody is pointing a gun at you.You need that copper to shoot back. You don't do an NPV model.So we see massive military demand. Europe is rearming.Japan is rearming.

Taiwan wants to turn into a bigporcupine. The United States military is worriedabout a shortage of 155 millimeter Howitzer shells.What do you think the world's army is made out of as all this shooting goeson? And meantime, we have a huge amount ofhumanity that wants to green the world economy, building electric cars,windmills. So everything you touch requires coppermetal in the modern economy, including this wonderful studio where we'resitting smiling at each other. Well, Robert, I have to say, I hope Inever need copper that badly.

But let's assume that we stay aroundthese levels, $83,000 or so. What would that mean for the legacymines that are in business right now? The legacy mines are in the process ofslowly dying. They're very low grade.They're generating more and more global warming gas per unit of production.It's really, really difficult to bring a copper mine into production.Usually takes 20 years or so for a tier one mine to be discovered, built andconstructed. And we've had such a long period of timewhen all the money in the world went into your previous guest like Netflix orbroadband or wireless or really sexy.

Disruptive technology.And we didn't put money into mining, into basic raw materials.And so this is the revenge of the old economy.And suddenly we have a shortage of these metals.And so it's inevitable that the price will rise.It's only a question of when. Well, let's talk a little bit more aboutthose legacy mines, in your words, in the process of slowly dying, what sortof timeline does that play out over Codelco, which is that been the largesthistorical producer in Chile, has watched production go down, down, downten years in a row?.

Mm hmm.So the Chilean mines at a high elevation take large amounts of electrical energy.Their grid is powered by coal. There's a huge amount of global warming,gas, period of copper. What's the point of trying to minecopper to green the world economy if we have to destroy the environment to findthat copper? So the problem is there aren't very manyplaces where you can build a green new copper mine to put into your Tesla oryour microwave oven or your washing machine.Well, the thinking is that, of course, as we think about that backdrop, thatmines are going to increasingly need to.

Be developed in really toughjurisdictions. Of course, you do have a successfultrack record there. You think about Mongolia, the DemocraticRepublic of Congo. How does that differ?Building a mine there versus Australia or the United States, for example,Australia? The United States are very difficultjurisdictions. There's no easy mining project anywherein the world. You take the Pebble Project in theUnited States, it's been legislated out of existence by the US government.The resolution project in Arizona has.

Been delayed for 30 years.A permanent dispute with the San Juan Apache Nation.So even in developed societies, it's very difficult to build a mind.From our point of view, we go anywhere on the planet where we see the beststore and the opportunity to produce metal in the greenest possible way.99% of electricity in the Democratic Republic of the Congo ishydroelectricity, which enables us to produce the metal with the lowest amountof global warming gas per unit of copper produced.And soon we'll have differential pricing in metals.The green of the production of the.

Metal, the more the premium and thedirtier the production of the metal, the greater the discount.Airbags Technologies is now starting such a market in Singapore, giving youdifferential pricing on the ESG characteristics of the metal produced.Well, let's talk a little bit more about your project in Congo, because thatproduced almost 400,000 tonnes of copper in 2023.You're also still expanding the mind as well.How could could it get how big could it get, rather?We're scheduled to be the third largest copper complex in the world in 2025 andwe have our sights set for sure on.

Number two with new discoveries.And God willing, it's possible to be number one.There's an enormous endowment of copper metal.The Congo was the world's largest historical producer of copper until thelow grade copper mines of Chile were invented in the 1960s.And the Congo is now the second largest producer after Chile.This is something new. And sowe think the Congo has the potential in mineral production to be number one,especially since the United States government has sponsored the Low Vitoquarter to connect the copper fields of.

The Congo directly with the oceanthrough Angola. That little veto quarter, which theBiden administration has backed with the G7 nations, is really going to improvethe ability to produce copper cheaply and in a green way in the DemocraticRepublic of the Congo.

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