The pandemic hasn’t damped deal-making enthusiasm in copper. In fact, interest — if not actual deals — is on the rise, according to JPMorgan Chase & Co. banker-turned-mining executive Hayden Locke.
“I feel like there’s more going on because corporate development teams can’t travel — they have more time on their hands to review what’s going on in the market,” Locke, the recently appointed president of explorer Marimaca Copper Corp., said in an interview. “I don’t know if that will translate into execution, but copper is very hot.”
Prices of the metal used in wiring have surged to two-year highs as producers struggle to keep up with strong demand in China. Longer-term prospects are buoyed by a lack of new discoveries and global electrification, including the shift toward electric vehicles. All that means copper is considered a green metal and big mining companies want more of it in their portfolios, Locke said.
His company isn’t quite ready to tap into that enthusiasm just yet. While it touts Marimaca as the most significant copper oxide discovery in Chile in 10 years, there’s still plenty of drilling to do before it’s deemed feasible as a mine. What lies under the oxide is “the billion dollar question,” he said.
For now, Marimaca has the backing of two large shareholders — Greenstone Resources and Tembo Capital Mining — that could finance part of its development costs, and is confident of accessing other financing including debt, Locke said.
As far as Marimaca becoming a takeover target, he said the company sees itself as a mine builder, with future ownership questions something for shareholders to ponder.
“We are known and we know everybody in the space and we are constantly having conversations,” he said. “But we’re not interested in this point of time in engaging on that front so there are no real detailed discussions from that standpoint.”
(By James Attwood)