00:00An hour east of Phoenix, Arizona.
00:02It might be a little too big.
00:06We kind of reconditioned and repurposed a lot of old mining equipment.
00:10More than a mile beneath the desert surface.
00:13You'll get more comfortable once you're standing on the ground and you'll forget that you're so far below the ground.
00:20The mining giant Rio Tinto thinks it's found one of the largest undeveloped copper deposits in the world.
00:26All right.
00:27We had a chance to tour the facility back in late March.
00:33The Resolution Copper Mine sits on an ore deposit that may produce as much as 40 billion pounds of the
00:38metal over 40 years.
00:40This is brand new.
00:41It's enough to meet roughly a quarter of projected U.S. demand.
00:45It lies almost 7,000 feet under the surface, just over a mile, equivalent to four and a half Empire
00:51State Buildings.
00:52We went down into the mine with Resolution Copper's president, Vicki Pisi.
00:56The deposit is incredible.
00:58It's two billion tons at one and a half percent copper.
01:03It's the second largest undeveloped copper deposit in the world.
01:08That's 25 percent of the U.S. demand for copper.
01:11And the grade is very high, one and a half percent.
01:15You know, most of the copper that's mined in the U.S. today from a handful of mines that are
01:20very old, over 100 years, are less than half a percent of copper.
01:25So this is quite a rich deposit.
01:28And it will be operated for decades.
01:32It's hard to overstate how dire the copper shortage is in this era of A.I.
01:38Copper use is soaring, particularly for data centers and defense.
01:42By 2040, demand is expected to rise over 40 percent.
01:46You know, we haven't seen a response on supply increasing by 50 percent year on year.
01:52Ultimately, if you want economic growth, if you want data center buildouts, if you want defense buildouts, you know, you
01:59need copper.
01:59Orion Delanois is executive director of Energy Transition and Critical Minerals at S&P.
02:05I think one of the interesting snippets is, you know, data centers and hyperscalers are planning to spend about 700
02:11billion dollars in capex this year.
02:14So when you're looking at the top 30 mining companies in the world, like their entire capex for this year
02:20is going to be about 100 billion tons.
02:22So on the demand side, you get 600 billion tons of capex in data centers.
02:28And on the supply side, you get just 100 billion tons in capex and mines.
02:32So there's a disconnect here between supply and demand.
02:35In the past, in the heyday of copper mining in the U.S., you'd find really great quality copper that
02:41was easy to mine, easy to process, and easy to refine.
02:44Rosemary Katz is a copper analyst for Bloomberg New Energy Finance.
02:48Now the material is deeper.
02:50The economics means you have to remove more waste, and hence you need more energy and time to process it.
02:56And those are the things that have been curtailing the number of new finds and investments into these discoveries.
03:04Chile has always dominated global copper production, but in recent decades, the U.S. has lost ground to China, Peru,
03:11and the Congo, dropping from second globally.
03:14Our ability to bring on new supply is critical, and our ability to keep the smelters we do have full
03:21is really a national security issue.
03:24The U.S. has more than 275 million metric tons in reserves and resources, comparable to Canada and Australia combined.
03:34Yet only three mines have come into production since 2002.
03:38Regulation and legal challenges have meant, on average, a new U.S. mine takes nearly 29 years to go from
03:45discovery to production.
03:46That's six years slower than the global average.
03:49So it's really important that, because this takes time, we need to start now.
03:54And again, every day that we delay resolution copper is another day that we continue to depend on foreign sources
04:01of copper.
04:02We have the resources here, and I think, you know, United States can really take control of their own destiny
04:09as far as copper production
04:11and close that chronic deficit that has existed for decades.
04:15It's taken more than a dozen years for resolution to do much more than drill a mine shaft.
04:20This is good timing for you to be here.
04:23In late March, the very day we filmed there, the project finally got the go-ahead.
04:28This is a region where there is double-digit unemployment, and the jobs are meaningful.
04:34The economic development is meaningful.
04:37A billion dollars a year into Arizona's economy is a really big deal.
04:41The competition is not only over who has copper in the ground.
04:45It is over who can process it, move it, and turn it into usable metal fastest.
04:50China dominates that process, importing about 60 percent of global copper ore and concentrate
04:55and producing more than 45 percent of the world's refined copper,
04:59about 14 million metric tons in 2025, compared to 850,000 in the U.S.
05:06So the copper smelters, they've gone from 16 operating ones back in the 1980s
05:12to now just two operating assets in 2026.
05:16Some of them have closed because of environmental issues.
05:20Some of them have closed because of difficult economic situations.
05:24So now we're down to two processing facilities, and actually the U.S. exports concentrate to other countries
05:34like Canada, South Korea, Mexico to get that mining product processed.
05:39So about 57 percent of the refined copper is imported from other countries for the U.S.'s domestic use.
05:47So there's a clear reliance on imports.
05:49Demand is growing by about 40 percent for the U.S. between now and 2040.
05:55And that demand is going to be driven by data centers.
05:58It's going to be driven by energy transmission and distribution.
06:02It's going to be driven by clean technologies.
06:04And so some of those aspects become almost a national security issue.
06:09When you talk about critical minerals and what we produce here in the United States,
06:14I think the mining industry gets forgotten about a little bit.
06:17I don't know if it's really underappreciated.
06:20I think it's just not really known to the general public.
06:24We take a lot of that stuff for granted, that when you flip a light switch, the power just comes
06:28on.
06:31Nate Foster is the managing director of Rio Tinto Kennecott,
06:34one of only two facilities in the United States that is home to the entire copper supply chain.
06:40From here, it goes through a crusher, goes on about a five-mile conveyor belt to a concentrator.
06:45What a copper concentrator does is it takes that blasted rock, crushes it, pulverizes it,
06:51and then we actually float copper, believe it or not.
06:54And so the concentrator makes about a 25 percent pure copper concentrate.
06:59From there, it's shipped to the north of us, to our smelter and refining,
07:03where it goes from a 25 percent copper concentrate through a series of refining furnaces.
07:09Fired by natural gas, they refine the ore into what are called cathodes, 99.9 percent pure copper.
07:16It's an absolutely fascinating, highly technical business.
07:20Kennecott, about 20 percent of all of this nation's refined cathode comes from our operation.
07:27Other companies are working on different ways to fill the copper gap.
07:30These are printed circuit boards.
07:32One promising strategy, recycling scrap into domestic supply.
07:36You can see copper traces.
07:38The German copper company Arubis opened a recycling smelter in Augusta, Georgia last year
07:43and is already expanding it.
07:45The U.S. produces around 2 million metric tons of copper-containing strap annually.
07:52And it's very fragmented.
07:54It's across the country.
07:56And most of it is still landfilled and exported.
07:59Most of it is exported actually to China.
08:00So that's why also the local recycling companies and the scrap dealers,
08:05they welcome us coming here because they don't have to export it to other countries.
08:09They can keep it in the country.
08:11So it comes from mostly medium and large recycling companies.
08:17There's different types of recycling material.
08:19On the one hand, there's the basic copper scrap.
08:22Then there's copper cables.
08:23But then there's also more complex recycling materials like circuit boards,
08:27which contain copper, but also other metals like gold, silver, nickel, tin, and so on,
08:33which are also attractive.
08:34And how much can you produce?
08:36Well, we just finished phase one here in our enrichment site.
08:39There we consume 90,000 tons of recycling material
08:43and we produce 35,000 tons of blister copper.
08:46Now in summer, we will finish phase two, which adds, which is doubling the capacity.
08:52So when phase two is finished, we will have an output capacity of around 70,000 tons of blister copper.
08:59We are aiming for about 180,000 tons of input material here for this facility.
09:04And we're also planning to produce 100, roughly 180,000 tons of product.
09:09So we're very close to zero waste, converting everything into other materials.
09:14David Schulteis is Arubis Richmond's president.
09:16Back there at the end, you can see higher grade copper material.
09:18You can see the typical reddish color that comes with copper.
09:22For a layman, looking at these materials, it's sometimes difficult to understand.
09:25Is there even metal inside?
09:27I can guarantee you there is plenty of metal inside.
09:30This is really the material that we're looking for.
09:31Wow.
09:33And that's where the complexity is.
09:34Yeah.
09:35Our main value contribution is to melt down the materials that we have,
09:40build the phases, separate the materials,
09:41and bring the variety of metals back into the industrial life cycle.
09:46Scrap is just a portion of the story.
09:49So it's quite marginal, quite incremental.
09:51It won't close that gap that the U.S. needs to close.
09:55It needs to close about a million tons of refined copper.
09:59And scrap is just incremental gains.
10:03Usually, markets are the key.
10:05The copper supply gap has prices for the metal near all-time highs.
10:08And that has more mines, smelters, and recycling plants on the drawing board.
10:13National security may drive regulatory relief.
10:16But for now, time remains the biggest obstacle.
10:19Copper may not get the attention of rare earths,
10:22but for the coming American economy, it's perhaps even more important.
10:25When you look at these hyperscale data centers that are really around AI,
10:30they can consume as much as 50,000 tons of copper in one facility.
10:3650,000 tons, right?
10:38So put that in perspective of Kennecott.
10:40All the metal that we mine in a year would supply only four data centers.
10:44And so when you start looking around the fundamentals of that demand
10:48that's coming with AI and data centers, you can't build them without copper.
10:52So why is it important for investors to pay attention to all of this?
10:56Copper is the metal of electrification.
10:59It is what really fuels the economy.
11:02You've probably used copper maybe a dozen times so far,
11:06you know, by the time that you wake up.
11:07It is critically important.
11:10And the fact that it is needed so much in our daily lives,
11:13it's something everybody should be paying attention to.
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