30 July 2026
Anglo highlights ability to provide capital efficient copper growth in tightening market
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The capital intensity of mining has risen well ahead of inflation and mining project development timelines are continuing to extend, Anglo American CEO Duncan Wanblad pointed out on July 30 when he reported $2.9-billion half-year copper earnings at a 60% margin.
Accentuated by Wanblad is the ability of Anglo to provide capital efficient growth in a tightening copper market. (Also watch attached Creamer Media video.)
"We're of the view that the formation of Anglo Teck can only be positive for the increasing of global copper supply," said Wanblad of the merged entity that he will lead this year or early next year. (Also watch attached Creamer Media video.)
Anglo's copper business produced 344 000 t of production in the six months to June 30 and is on track to meet full year guidance of 700 000 t to 760 000 t.
Bringing new copper online is becoming ever more expensive. The rate of inflation for capital intensity is running at almost double the increase in consumer price index (CPI) terms, Wanblad explained during the presentation of half-year results covered by Mining Weekly.
"Capital is, therefore, now a bigger part of the project's economics than ever before and returns need to be higher just to justify those elevated costs,"
"As capital inflation continues, the economics of many growth projects are at risk without higher prices and this is why we believe the copper price has to be structurally higher.
"It's also taking a lot longer to build and deliver these projects. Back in the 1990s, it took about seven years, from the time that an orebody was discovered to bringing it into production.
"Over the last decade or so, that has stretched out to almost 18 years and if that carries on, the cycles will take longer to move from trough to peak and we'll see much biggest swings in price.
"This is especially true when so much of the demand for copper is coming from strategic buyers, who rally aren't all that price sensitive.
"So, in that kind of world, projects that you can deliver in the short to medium term without spending a fortune to build them, become hugely valuable," said Wanblad.
Over the last 15 years, the mining industry's capital expenditure estimates have tended to come in considerably worse than what estimated at the study stage,
" So, in that world, low complexity and low capital intensity is exactly where you want to be," Wanblad commented.
Starting from lower capital intensity, protects returns, and positions copper mining companies to benefit from price upside that these supply dynamics should drive.
Against that background, the integration of Collahuasi and Quebrada Blanca is seen as a promising prospect that provides capital-efficient copper growth at scale in the near term.
There is potential to add an incremental 175 000 t of copper production a year at a capital expenditure (capex) of $2-billion, or $11 000 of capex per ton of copper growth.
Moreover, the integration would still allow for further growth of both assets, which provides increased flexibility for future options, including leaching and other plant expansions.
Anglo is putting the building blocks in place to bring about this integration "and just like any other adjacency that we've bought over the last few years, it's important that we take our time and we do this properly".
Much of what drives the extended schedules for copper projects is the time needed for permitting, planning, and stakeholder alignment, "so we want to get that right from the outset. We continue to believe that this is by far the best way forward for both. It sits right in that sweet spot: low capital intensity, relatively low execution risk, high confidence and near-term copper growth at real scale, and I'm genuinely confident about the potential h...
The capital intensity of mining has risen well ahead of inflation and mining project development timelines are continuing to extend, Anglo American CEO Duncan Wanblad pointed out on July 30 when he reported $2.9-billion half-year copper earnings at a 60% margin.
Accentuated by Wanblad is the ability of Anglo to provide capital efficient growth in a tightening copper market. (Also watch attached Creamer Media video.)
"We're of the view that the formation of Anglo Teck can only be positive for the increasing of global copper supply," said Wanblad of the merged entity that he will lead this year or early next year. (Also watch attached Creamer Media video.)
Anglo's copper business produced 344 000 t of production in the six months to June 30 and is on track to meet full year guidance of 700 000 t to 760 000 t.
Bringing new copper online is becoming ever more expensive. The rate of inflation for capital intensity is running at almost double the increase in consumer price index (CPI) terms, Wanblad explained during the presentation of half-year results covered by Mining Weekly.
"Capital is, therefore, now a bigger part of the project's economics than ever before and returns need to be higher just to justify those elevated costs,"
"As capital inflation continues, the economics of many growth projects are at risk without higher prices and this is why we believe the copper price has to be structurally higher.
"It's also taking a lot longer to build and deliver these projects. Back in the 1990s, it took about seven years, from the time that an orebody was discovered to bringing it into production.
"Over the last decade or so, that has stretched out to almost 18 years and if that carries on, the cycles will take longer to move from trough to peak and we'll see much biggest swings in price.
"This is especially true when so much of the demand for copper is coming from strategic buyers, who rally aren't all that price sensitive.
"So, in that kind of world, projects that you can deliver in the short to medium term without spending a fortune to build them, become hugely valuable," said Wanblad.
Over the last 15 years, the mining industry's capital expenditure estimates have tended to come in considerably worse than what estimated at the study stage,
" So, in that world, low complexity and low capital intensity is exactly where you want to be," Wanblad commented.
Starting from lower capital intensity, protects returns, and positions copper mining companies to benefit from price upside that these supply dynamics should drive.
Against that background, the integration of Collahuasi and Quebrada Blanca is seen as a promising prospect that provides capital-efficient copper growth at scale in the near term.
There is potential to add an incremental 175 000 t of copper production a year at a capital expenditure (capex) of $2-billion, or $11 000 of capex per ton of copper growth.
Moreover, the integration would still allow for further growth of both assets, which provides increased flexibility for future options, including leaching and other plant expansions.
Anglo is putting the building blocks in place to bring about this integration "and just like any other adjacency that we've bought over the last few years, it's important that we take our time and we do this properly".
Much of what drives the extended schedules for copper projects is the time needed for permitting, planning, and stakeholder alignment, "so we want to get that right from the outset. We continue to believe that this is by far the best way forward for both. It sits right in that sweet spot: low capital intensity, relatively low execution risk, high confidence and near-term copper growth at real scale, and I'm genuinely confident about the potential h...