Oz Minerals is positioning itself as a global leader in mining “modern” metals that will underpin the global shift to electric vehicles and renewable energy.
The miner giving itself until the end of the year to decide whether to spend over $1 billion dollars to exploit a giant nickel and copper deposit in the Australian outback that would run on green power and supply critical materials to the EV and renewables sectors.
The company wants to build its West Musgrave mine and related processing facilities able to churn out 26,000 tonnes of nickel and 32,000 tonnes of copper a year by leveraging 100 per cent renewable energy generation to meet a looming supply shortage facing renewable vehicle and equipment makers.
The mine’s potential to capture a hefty chunk of the EV and renewables markets prompted rival miner BHP to try and buy Oz outright for $8.3 billion ($25 a share) this month.
OZ CEO Andrew Cole says shareholders remain unanimous in rejecting the unsolicited offer as inadequate, given the growth potential unfolding in the industry.
BHP since 2019 has identified copper and nickel as its preferred commodities for growth as global decarbonisation accelerates.
Cole says the company is bent on transitioning into a global leader in mining “modern” metals, which include copper and nickel, widely used in manufacturing solar panels, wind turbines and electric vehicle components, suggesting that if the numbers add up, construction of the mine will proceed.
The case for developing the mine at a cost of around $1.1 billion “is getting stronger, not weaker,” Cole said.
“The market is getting much stronger for nickel and copper and we are seeing a lot of the end users, the EV manufacturers, and battery manufacturers, starting to come up the supply chain to shore up their commodities,” he said.
Cole sees worldwide EV sales exceeding industry forecasts of 56 million units by 2030.
“The EV explosion is only just beginning and demand set to take off,” he said.
Oz has already issued a “roadmap” outlining how it intends to decarbonise all its current and future mining operations spread across Australia, Brazil and Sweden.
“OZ Minerals is uniquely placed to capitalise on the growing demand for the modern minerals that are integral to this multi-decade electrification and decarbonisation transition, which is only just getting started,” Cole said.
However, Cole says it could take until December before a final investment decision for West Musgrave is reached.
