Ivanhoe Electric (TSX:IE) is reportedly in ‘advanced discussions’ with potential buyers for copper produced at its Santa Cruz Project in Arizona, US, as demand for domestically sourced metal continues to grow.
In a recent interview with Bloomberg, CEO Taylor Melvin said the company has attracted interest from traditional commodity traders and strategic partners seeking US-produced copper.
However, he did not disclose the identities of the interested parties or provide details of the potential agreements.
Located 11km west of Casa Grande, Santa Cruz is Ivanhoe Electric’s flagship copper project, which the company has been advancing for the past five years.
Founder and Executive Chairman Robert Friedland has described Santa Cruz as the “highest grade, most advanced United States pure copper cathode project”.
The project is designed to produce 99.99% pure refined copper cathodes using a heap-leach processing, without the need for conventional smelting.
Ivanhoe has promoted the approach as a way to reduce emissions while producing refined copper directly at the mine site.
The offtake discussions come as the rapid expansion of data centres, power grids, and other infrastructure drives growing demand for copper across the US.
With global copper demand expected to outpace supply, Melvin believes the US faces a particularly pressing need to develop new domestic production.
“We need a lot more than Santa Cruz to fill that gap,” he told Bloomberg.
Financing discussions
Santa Cruz is among the key US mining projects seeking government-backed financing to support domestic critical minerals production.
In August, Ivanhoe Electric received a preliminary project letter from the Export-Import Bank of the United States (EXIM) for potential debt financing of up to US$1.1 billion ($1.58 billion).
Discussions over the financing remain ongoing, with the company also engaging approximately a dozen commercial banks about potential funding arrangements, according to Melvin.
The initial development phase of the underground copper mine is expected to cost approximately US$1.4 billion.
Early site preparation is already underway on the company’s wholly owned private land in Arizona.
Ivanhoe Electric is targeting first copper production in 2029, with Santa Cruz having a projected mine life of approximately 24 years.
Write to Jackson Chen at Mining.com.au
Main image: Ivanhoe Electric
