Global Copper Supply Faces Crunch as AI Investments Reshape the Energy Landscape

Rhea-AI Summary

Usha Resources (TSXV:USHA) (OTC:USHAF) has received an Intervention Permit for Mining Activities at its Southern Arm polymetallic VMS property, enabling preparations for a maiden drill program in winter 2025. The property features a 7.3 km conductive trend along the Bapst fault with potential for copper, zinc, gold, and silver mineralization.

The project is strategically located near significant deposits, including the B26 deposit (16 km away) with 11.32 Mt grading 1.23% Cu, 1.27% Zn, 0.46 g/t Au, and 31.9 g/t Ag, and the historic Selbaie mine which produced 53 Mt at 0.96% Cu, 1.9% Zn, 0.58 g/t Au, and 40.7 g/t Ag.

This development comes amid a broader copper market outlook where UBS predicts a supply deficit exceeding 200,000 tons by 2025, driven by AI infrastructure demands.

Positive

• Received key regulatory permit for mining activities
• Property located near proven high-grade deposits
• Planned 3,000-metre drill program for winter 2025
• Option agreement to acquire 100% of Southern Arm property

Negative

• No revenue generation until mining operations begin
• 24.1 year average development time for copper mines
• Results from Phase 1 field program still pending

Insights

Mining Industry Analyst

The receipt of an Intervention Permit for Usha Resources' Southern Arm property represents a significant operational milestone, but with immediate financial impact. While the property shows promise with its proximity to substantial deposits like B26 and the historic Selbaie mine, the planned drill program won't commence until early 2025. The property's 7.3 km conductive trend along the Bapst fault presents exploration potential, particularly given the area's proven VMS-style mineralization. However, with results from the Phase 1 field program and IP survey still pending and drilling months away, this news primarily indicates procedural progress rather than material value creation.

Commodities Market Analyst

The broader context of copper market dynamics presents a compelling backdrop for copper exploration projects. UBS's projection of a 200,000-ton supply deficit by 2025 and the International Energy Forum's call for 1.1 new mines annually through 2050 underscore the strategic importance of new copper discoveries. The potential for copper prices to reach $40,000 per tonne in the next four years, driven by AI infrastructure investments exceeding $1 trillion, creates a favorable environment for copper explorers. However, the 24.1-year average development timeline for copper mines means that today's permitting news, while positive, is just an early step in a lengthy process.

USA News Group News Commentary
Issued on behalf of Usha Resources Ltd.

VANCOUVER, BC, Dec. 16, 2024 /PRNewswire/ -- USA News Group – The ongoing boom in Artificial Intelligence (AI) is lifting demand on several commodities, in particular copper. AI's infrastructure needs, especially data centers, are fueling a copper surge, to the benefit of mining companies. According to a "never-wrong" oil hedge fund manager from France, copper could hit $40,000 a tonne over "the next four years or so". With AI-focused tech giants reportedly set to invest over $1 trillion in infrastructure and power grid development, analysts are expecting a significant surge in demand for copper. Swiss bank UBS foresees a copper shortage, with a predicted supply deficit surpassing 200,000 tons by 2025. S&P Global Market states that copper mines are one of the slowest to develop, taking 24.1 years on average, meaning work being done now is becoming increasingly more important for tomorrow. Among the mining-focused companies making recent important progress include Usha Resources Ltd. (TSXV:USHA) (OTC:USHAF), Capstone Copper Corp. (TSX: CS) (OTCPK: CSCCF), Lundin Mining Corporation (TSX: LUN) (OTCPK: LUNMF), Orla Mining Ltd. (TSX: OLA) (NYSE-American: ORLA), and Arizona Sonoran Copper Company Inc. (TSX: ASCU) (OTCQX: ASCUF).

The article continued: Earlier this year, the International Energy Forum released a report, warning that 1.1 new mines with an average production of 472,00 MT will need to come online annually through 2050. Last week, copper prices jumped by more than 2% overnight, after China's politburo signalled it is abandoning its "prudent" monetary policy stance, for the first time since 2008.

Usha Resources Announces Receipt of Intervention Permit for Upcoming Drill Program at the Southern Arm Copper-Gold VMS Property

Usha Resources Ltd. (TSXV: USHA) (OTC: USHAF), a North American mineral acquisition and exploration company, today announced that it has been granted an Intervention Permit for Mining Activities by the Ministere des Resources Naturelles et des Forets (MRNF) at its Southern Arm polymetallic VMS property ("Southern Arm" or the "Property"), in the northwest Abitibi subprovince. This document permits the Company to begin access and drill pad preparations in advance of the company's planned maiden drill program in the winter of 2025. Usha has already entered into an option agreement to earn 100% of Southern Arm over 2 years from Abitibi Metals.

"Receiving this permit is a key milestone as we progress towards our maiden drill program at Southern Arm," said Deepak Varshney, CEO of Usha Resources. "With results of our Phase 1 field program and IP survey anticipated to be received by end of year, Usha will commence a drill program targeting the highest priority zones early in 2025."

The project is located in a region well-known for its rich deposits of precious and base metals. Notable nearby projects include the B26 deposit, just 16 km away, which holds an indicated resource of 11.32 million tonnes (Mt) grading 1.23% copper (Cu), 1.27% zinc (Zn), 0.46 g/t gold (Au), and 31.9 g/t silver (Ag). Also nearby is the historic Selbaie mine (15 km away), which produced 53 Mt at 0.96% Cu, 1.9% Zn, 0.58 g/t Au, and 40.7 g/t Ag, and the Fenelon Gold Project (15 km away), hosting an indicated resource of 2.4 million ounces (Moz) of gold and an inferred resource of 1.7 Moz.

"With negotiations for the Jackpot Lake transaction continuing, our focus in the field will remain on Southern Arm," added Varshney. "Additionally, we have been evaluating additional opportunities to acquire copper and/or gold projects to create further shareholder value in a similar fashion. We look forward to providing shareholders updates as our strategy progresses."

The property itself features a 7.3 km conductive trend along the regional Bapst fault, an area linked to zinc, lead, silver, molybdenum, and copper occurrences, with geology and alteration suggesting potential for polymetallic VMS-style mineralization. Drill targets along this trend will be finalized based on results from the black spruce bark sampling program and the ongoing Induced Polarization (IP) survey. Results for both programs are expected by year-end.

Located in the Abitibi greenstone belt, the Southern Arm project features a 7.3-kilometre copper-gold trend along the Bapst fault, an area with proven potential for polymetallic deposits. Nearby successes include the historic Selbaie mine and the B26 deposit. The property's volcanic geology, similar to these major sites, shows signs of copper, zinc, gold, and silver mineralization. Usha Resources is using modern exploration techniques, including induced polarization surveys and black spruce bark sampling, to pinpoint high-priority drill targets for its upcoming 3,000-metre drill program planned for winter 2025.

CONTINUED… Read this and more news for Usha Resources Ltd. https://energymetalnews.com/2023/02/28/charging-along-the-highway-towards-domestic-lithium-dominance/

Other recent industry developments and happenings in the market include:

Capstone Copper Corp. (TSX: CS) (OTCPK: CSCCF), an Americas-focused copper mining company, recently published its 2023 Sustainability Report titled "Building Capacity. The Report was prepared with reference to the Global Reporting Initiative (GRI) Standards and in accordance with the SASB Metals and Mining Sustainability Accounting Standard. The Report details Capstone's performance on material sustainability topics across its operations for the period from January 1 to December 31, 2023. In 2023, Capstone strengthened its ability to meet both business and sustainability goals. Key achievements included earning The Copper Mark certification for its Mantos Blancos and Mantoverde operations and advancing its Sustainable Development Strategy with the launch of new cross-site initiatives.

"I am pleased to share our 2023 sustainability report for Capstone Copper," said John MacKenzie, CEO of Capstone. "Bringing together the assets and teams of our two predecessor companies has enabled us to realize opportunities of scale, cross-learning and technical excellence as we endeavour to grow responsibly and create a positive impact in the lives of our people and communities."

Lundin Mining Corporation (TSX: LUN) (OTCPK: LUNMF), a diversified Canadian base metals mining company, recently announced it had signed a definitive agreement to sell its Neves-Corvo operation in Portugal and Zinkgruvan operation in Sweden to Boliden AB for up to US$1.52 billion in total consideration. Lundin Mining will receive $1.37 billion in cash at closing, based on a debt-free enterprise value of $1.3 billion as of August 31, 2024. An additional $150 million may be paid if certain conditions are met. Proceeds will strengthen the company's balance sheet and support growth in the Vicuña District.

"Neves-Corvo and Zinkgruvan have played a significant role in catalyzing the Company to become a multi-asset base metals producer of global scale," said Jack Lundin, President and CEO of Lunding Mining. "We believe these operations will be an excellent strategic fit under Boliden's operatorship, and the employees and local stakeholders will benefit from the new ownership and highly experienced management team. The sale will further strengthen our balance sheet to support the Company's growing portfolio in South America and enable management to concentrate our focus in an area which will provide the greatest long-term value for our shareholders. It is an opportune time to optimize our portfolio through this divestiture as we drive towards becoming a top-tier copper-dominant mining company."

Orla Mining Ltd. (TSX: OLA) (NYSE-American: ORLA), a mining company with multiple assets in North America, recently provided an update on exploration at its Camino Rojo Extension, now referred to as "Zone 22", in Mexico. Recent drilling at Camino Rojo extended mineralization 800 metres beyond the current resource, uncovering high-grade copper-gold-silver zones with copper grades reaching 4.95%. This distinct copper-gold event, associated with deep extensions near a felsic dike, remains open at depth and along strike, with results suggesting the system could lead to even stronger mineralization. An initial underground resource estimate is expected in early 2025.

"The existing mineralization in the upper Caracol-host already set a strong foundation for the initial underground sulphide resource," said Sylvain Guerard, Senior Vice President, Exploration for Orla Mining. "It is now becoming clear that the future project will be enhanced by the Zone 22 Extension, and we continue to be impressed with the drill results: high-grade, polymetallic, and favourable metallurgy. Zone 22 remains wide-spaced drilled and open down-plunge, offering significant potential for further infill and step-out drilling to contribute to both resource growth and upgrades."

Arizona Sonoran Copper Company Inc. (TSX: ASCU) (OTCQX: ASCUF), an emerging US-based copper developer, recently announced results from 12 leach columns completed from its column leach metallurgical testing program at the Cactus Project, Arizona. The Parks/Salyer deposit achieved an 87% average soluble copper extraction rate over 180 days of leaching, supporting its heap leach potential as outlined in the 2024 Preliminary Economic Assessment (PEA). Ongoing testing aims to optimize extraction rates, with results indicating the potential for 93.7% recovery over extended leaching periods, further strengthening the deposit's role in future production plans.

"Across the Parks/Salyer, Cactus West and Cactus East deposits, we benefit from similar mineralogies and no deleterious materials as evidenced from four years of metallurgical testing on the three deposits," said Steve Dixon, Chief Metallurgist of ASCU. "Test work using standard best practice conditions is ongoing and will continue until we hand off testing to operations, assuming a positive construction decision post-Definitive Feasibility Study."

Source: https://energymetalnews.com/2023/02/28/charging-along-the-highway-towards-domestic-lithium-dominance/ 

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SOURCE USA News Group

FAQ

When will USHAF begin its maiden drill program at Southern Arm?

Usha Resources plans to begin its maiden drill program at Southern Arm in winter 2025, following the receipt of their Intervention Permit for Mining Activities.

What are the mineral grades of deposits near USHAF's Southern Arm property?

The nearby B26 deposit contains 11.32 Mt grading 1.23% copper, 1.27% zinc, 0.46 g/t gold, and 31.9 g/t silver, while the historic Selbaie mine produced 53 Mt at 0.96% copper, 1.9% zinc, 0.58 g/t gold, and 40.7 g/t silver.

How long is the conductive trend at USHAF's Southern Arm property?

The Southern Arm property features a 7.3 kilometer conductive trend along the Bapst fault.

What is the timeline for USHAF to earn 100% of the Southern Arm property?

Usha Resources has entered into an option agreement to earn 100% of Southern Arm over 2 years from Abitibi Metals.