Critical Metals enters copper market with production at Congolese mine
Critical Metals has entered the copper market, as it looks to cash in on the orange metal’s latest rally – beginning production at a large mine in the Democrat Republic of Congo (DRC)
The strategic minerals specialist has commenced mining at the Molulu Project, an ex-producing copper cobalt site, following the completion of preparation work and the arrival of key mining equipment.
The Molulu Project is located in the Katanga Copperbelt, which has been mined for metals since at least the late 19th century and contains some of the world’s richest copper, cobalt, and uranium deposits.
The site was the first deal made by the company after its readmission on the main market last September.
The company owns 100 per cent of Madini Occidental, which holds an indirect 70 percent interest in the Molulu Project.
It is estimated to produce approximately 10,000 tonnes of copper oxide ore per month.
The copper ore produced this month will be stockpiled for sale into the market in February 2023.
Copper prices have soared over $9,000 per tonne this month, with investors expecting increased demand in the malleable metal following the reopening of China’s economy and the expected boom in renewable energy projects and electric cars.
It is an essential metal for building construction including roofing and wires, alongside infrastructure such as transmission networks, and is used in wind turbines and EV batteries.
With the UK, US and EU targeting a vast ramp up of renewable energy over the coming decades, copper’s prices are likely to be supported into the long-term.
Critical Metals has assembled a strong team on site including a project manager, four geologists, two mine engineers, and a mine manager. `
All copper material extracted from the mine will be sent to local processing plants, of which there are four in the Likasi and Lubumbashi areas expressing interest in purchasing Molulu copper ore.
Russell Fryer, chief executive of Critical Metals, said: “2022 was a uniquely transformational year for Critical Metals and 2023 already looks to continue this positive trend. I believe that the Molulu Project has the potential to become an exceptional producer of cobalt and copper in the DRC and I look forward to updating shareholders on our progress throughout 2023.”
With copper ore production now underway, the Critical Metals expects to be free-cash flow positive by the end of the first half 2023, reflecting the high cash flow potential for copper current market conditions.