Copper may be flirting with record highs but the metal is far from peaking as the energy transition revs up, according to Newmont Corp. Chief Executive Officer Tom Palmer.
Futures hit $10,000 a metric ton on Thursday for the first time since 2011 as mines struggle to keep up with surging demand. Newmont, the world’s largest gold producer, is increasing exposure to copper through several “mega projects,” Palmer said on an earnings call.
Even if just one materialises, copper will account for 15-20% of the company’s total output by the end of the decade, he said.
“I’m pretty excited about having good exposure to copper at that time when the world is going through the energy transition,” Palmer said on an interview with Bloomberg TV following the earnings call:
“Copper’s got a pretty good story in front of it. I think its day in the sun is more towards the end of this decade.”
The copper push doesn’t mean Palmer has a downbeat view on gold. He sees bullion prices holding their current “very healthy levels” or even moving higher given fiscal and monetary stimulus. India should remain one of the key sources of demand after the country recovers from the Covid-19 tragedy, Palmer said.
Palmer was speaking on the day Newmont released solid first quarter results for 2021:
- Produced 1.5 million attributable ounces of gold and 317 thousand attributable gold equivalent ounces from co-products
- Reported gold CAS* of $752 per ounce and AISC* of $1,039 per ounce
- Generated $841 million of cash from continuing operations and $442mn of Free Cash Flow (99 percent attributable to Newmont)*
- Full-year production continues to be back-half weighted, in line with 2021 guidance**
- Declared first quarter dividend of $0.55 per share, consistent with the previous quarter***
- Ended the quarter with $5.5bn of consolidated cash and $8.5 billion of liquidity with a net debt to adjusted EBITDA* ratio of 0.2x
- Reduced $550mn of debt outstanding with available cash in April 2021
- Executed $3bn sustainability-linked revolving credit facility, demonstrating Newmont’s unwavering commitment to industry-leading environmental, social and governance (ESG) practices
- First production from Boddington Autonomous Haulage System, delivering safety and productivity improvements; leading the way as the industry's first autonomous haulage fleet
- Announced acquisition of GT Gold,+ located in the prospective Golden Triangle adding profitable copper and gold exposure to Newmont's industry-leading project portfolio
- Continued focus on fatality prevention through global application of critical controls
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