resource dependence

A Bank of America commodity strategist warns that the world may be “running out of copper” amid widening supply and demand deficits. Suggesting that prices could hit $20,000 per metric ton by 2025, the strategist’s note called out that inventories are currently at levels seen 15 years ago, and that existing stocks may cover just over three weeks of demand.

A recent CNBC story on the issue outlines how demand for traditional mainstay metals like copper is also surging because of its “vital role in a number of rapidly growing industrial sectors, such as electric vehicle batteries and semiconductor wiring.”

CNBC cites David Neuhauser, founder and managing director of U.S. hedge fund Livermore Partners, who, in light of growing investment in electrification as countries move towards greener infrastructure believes that “copper is the new oil,” and predicts that the metal will look “tremendous for the next five to 10 years.”

As we’ve learned the hard way over the course of the coronavirus pandemic, with increased demand for critical minerals — which is in large part driven by a global push for carbon neutrality — come increased supply challenges.

These challenges are compounded by the inherent irony of mineral resource supply: Proponents of a green energy shift for the United States tend to vehemently oppose the domestic development of the very metals and minerals that make that shift possible.

Laura Skaer, a member of the board of directors of the Women’s Mining Coalition and former director of the American Exploration & Mining Association, outlines a case in point for copper in a recent piece for Morning Consult.

Skaer points to recently-introduced federal legislation that would stop the development of a big copper mine near Superior, Arizona. The mine could supply a quarter of our nation’s copper demand and has strong support in the community, as Skaer writes. The federal bill, however, would, in Skaer’s view “close the door on a project that will benefit Arizona and the entire nation, expose the federal government to substantial takings claims, and send a signal to other companies that America is closed for business when it comes to mining.”

Concludes Skaer:

“The United States can become a domestic minerals supply-chain powerhouse — but not if Congress withdraws mining permission from areas where mineral development is a vital source of jobs and tax revenue.

If we want to have a serious conversation about infrastructure and clean energy, we have to start at the beginning of the supply chain by boosting our domestic supply of copper. The inescapable fact is that mines can only be located in the few places where economically viable mineral deposits have been formed and discovered. Arizona’s Copper Triangle is one of those rare places.

For the sake of the clean energy future so many Americans want and the national security and the economic investment we need, the Resolution Copper project must not be delayed any more.”

If Copper is the new oil, we should act accordingly.

To read Skaer’s full piece, click here, and to learn more about the Women’s Mining Coalition, click here.

The sands of geopolitics are shifting. As Anumita Roychowdhury, Snigdha Das, Moushumi Mohanty, Shubham Srivastava outline in a multipart series for India’s Down to Earth magazine, global competition, cooperation and conflicts are less about arms and oil, and more about critical technologies as the world is experiencing a “Fourth Industrial Revolution, an age of advanced technology based on information and communication, where artificial intelligence, self-driving cars and the internet of things are not just sweeping across businesses and societies but also evolving rapidly.”

They argue that the coronavirus pandemic has accelerated deployment of these applications earlier than anticipated. That, coupled with the fact that “50 per cent of the world’s GDP and half of global CO2 emissions now covered by a net-zero commitment” with close to 115 countries having pledged carbon neutrality by 2050, will have fundamental ramifications for geopolitics — the “scramble for natural resources to drive its energy requirements.”

They point to a study by the UK’s major oil company, BP, which indicates that after more than 150 years of near-uninterrupted growth demand for oil may have already peaked and now “faces an unprecedented decades-long decline.”

The massive momentum for the energy transition will, they say, “along with the need to attain technology supremacy, increase countries’ dependence on materials necessary for the technological marvels of tomorrow,” and will ultimately have us see global geopolitics “shift from oil producing countries to the rare earth and other critical mineral producing countries in the coming years.”

Such are the consequences of the world having entered the “Tech Metals Age,” as ARPN’s Daniel McGroarty phrased it in 2019. It’s a brave new world, and adjusting to the new realities and thriving in them will warrant a rethink — and a fast one at that. We may be leaving the Petro Age, but we can take a page from its playbook.

As McGroarty told members of Congress during a virtual forum on critical minerals held earlier this month:

“(…) if we entered the Tech Metals Age, we’re not lost without a map in this new world. We can take a page from the successful effort to reverse decades of dependency on foreign oil: The secret to achieving American energy independence? An ‘all of the above’ strategy that didn’t pit one form of energy against another, but embraced oil and natural gas and coal and wind and solar and hydro, biofuels and nuclear power. The common denominator: Energy produced in the U.S., by American companies and American workers, with American ingenuity and American investment.”

That “all of the above” approach should extend both to resource production and processing, as well as policy, a view that was reinforced by the latest IEA report on a pathway to carbon neutrality by 2050.

Here’s hoping that the Biden Administration — after taking several positive steps in the direction of “all of the above” — acknowledges that in a post-Petro Tech Metals Age, there is no room for simplistic “not in my backyard,” or “keep it all in the ground” mantras.

Touting his infrastructure package at Ford’s electric vehicle plant in Michigan last week, President Joe Biden declared: “The future of the auto industry is Dearborn,electric. There’s no turning back.”  Against the backdrop of the Biden Administration’s push for a low carbon energy future and a global push to reduce greenhouse gases, the International Energy Agency (IEA) has [...]

During a virtual congressional policy forum on critical minerals hosted by House Committee on Natural Resources Republicans earlier this week, experts agreed that the United States must adopt a holistic “all of the above” approach to critical mineral resource policy. Panelists at the event, which can be re-watched in its entirety here, included: Daniel McGroarty, [...]

Speaking at a virtual forum hosted by House Committee on Natural Resources Republicans on the role of critical minerals in geopolitics, renewable energy production and beyond earlier today, ARPN’s Daniel McGroarty called on policy stakeholder to apply the “all of the above” approach that helped reverse decades of American dependence on foreign oil to the [...]

In a new piece for Forbes, Jude Clemente, principal at JTC Energy Research Associates, LLC, outlines the size and scope of the ambitious climate goal of electrification to fight climate change, and discusses the underlying challenges associated with the shift. Clemente argues that the likely surge in electricity demand as the world seeks to decarbonize [...]

As the Biden Administration intensifies its efforts to promote its ambitious renewable energy agenda, energy analyst David Blackmon recently took aim in a piece for Forbes at what we previously called the “Green New Deal’s inherent irony”: the fact that “the same green lobby that advocates for the ‘Green New Deal’ is perhaps the largest [...]

As was to be expected, President Joe Biden used his State of the Union address to both chambers of Congress to tout his American Jobs Plan, which has been billed as comprehensive package to make the economy more productive through investments in infrastructure, education, work force development and fighting climate change. And while nobody can [...]

The Biden Administration has shifted focus to its next major legislative priority in the context of the president’s “Build Back Better” agenda — a multi-trillion dollar jobs and infrastructure package. Billed as a plan to make the economy more productive through investments in infrastructure, education, work force development and fighting climate change, the package will [...]

Like the United States, Canada has subjected itself to an “increasingly uncomfortable reliance” on China for critical mineral supplies, but its wealth of metals and minerals beneath the country’s soil could, if properly harnessed, give Canada a significant strategic advantage in years to come, mining executives and experts recently told Canada’s House of Commons resource [...]