McEwen Mining: Los Azules Feasibility Study as a Catalyst for Copper-Driven Growth in a Supply-Starved Market

The global energy transition is accelerating demand for copper at an unprecedented rate, driven by the electrification of transportation, renewable energy infrastructure, and grid modernization. According to the International Energy Agency, copper demand from renewable energy and mobility sectors is projected to grow by over 10% annually through 2025, with total global demand expected to reach 28 million metric tons by the end of the year. However, the industry faces a looming supply deficit, as the IEA warns of a potential 30% gap between supply and demand by 2035 due to declining ore grades, rising capital costs, and protracted project development timelines. In this context, McEwen Mining's Los Azules copper project in Argentina emerges as a strategically positioned catalyst for addressing these supply constraints while aligning with the decarbonization imperatives of the energy transition.

Los Azules: A Low-Cost, Long-Life Solution to Copper Shortages

McEwen Mining's July 2025 feasibility study for Los Azules confirmed the project as a long-life, low-cost copper producer with robust economic returns and sustainability credentials. The study outlined an initial capital expenditure (CAPEX) of $3.17 billion, with construction slated to begin in 2026 and first copper cathode production expected in 2030. Over its 21-year mine life, the project is projected to deliver an average annual production of 148,200 tonnes of copper, with a higher initial output of 204,800 tonnes in the first five years. This production capacity positions Los Azules as one of the world's largest undeveloped copper projects, with 10.9 billion pounds of indicated resources and 20.0 billion pounds of inferred resources.

The project's timing is critical. With global copper supply deficits projected to emerge as early as 2025-ranging between 300,000 and 500,000 metric tonnes annually-Los Azules is uniquely aligned to contribute to global supply chains during the deficit period. Its 21-year mine life ensures sustained production through 2051, directly overlapping with the peak demand phase for copper in the energy transition.

ESG Leadership and Renewable Energy Integration

Los Azules is not only economically compelling but also environmentally transformative. The project is designed to achieve carbon neutrality by 2038, operating entirely on 100% renewable energy and reducing mine-to-metal carbon intensity by 72% compared to industry averages. Additionally, it consumes 74% less water than conventional milling methods, addressing another critical sustainability challenge in mining. These metrics position McEwen Mining as a leader in ESG-aligned copper production, a growing priority for investors and regulators alike.

The project's environmental advantages are complemented by strategic partnerships. Collaborations with Stellantis and Nuton (a venture of Rio Tinto) underscore its role in securing copper supply for electric vehicle (EV) and battery manufacturing sectors. Furthermore, Los Azules has secured regulatory stability under Argentina's 30-year investment regime, which provides long-term tax and operational certainty.

Financial Viability and Strategic Positioning

From a financial perspective, the feasibility study highlights strong returns: a net present value (NPV) of $2.9 billion and an internal rate of return (IRR) of 19.8% as confirmed in the study. These figures reflect confidence in copper's long-term price trajectory, driven by structural demand from the energy transition. The project's CAPEX, while substantial, is justified by its low cash costs and high-grade resources, which are expected to generate consistent cash flow over its operational lifespan.

The strategic relevance of Los Azules is further amplified by the geopolitical risks associated with copper supply. China currently refines 19 out of 20 strategic minerals, including copper, creating vulnerabilities to trade restrictions and supply chain disruptions. By diversifying global copper sources, Los Azules helps mitigate these risks, offering a stable, North American-sourced alternative to China-dominated supply chains.

Conclusion: A Strategic Investment for the Energy Transition Era

As the energy transition intensifies, the need for secure, sustainable copper supply has never been more urgent. McEwen Mining's Los Azules project, with its low-cost production, carbon-neutral design, and alignment with global demand timelines, represents a rare combination of economic and strategic value. The project's regulatory approvals, partnerships, and ESG leadership further solidify its position as a cornerstone of the next phase of copper-driven growth. For investors seeking exposure to the energy transition's critical infrastructure, Los Azules offers a compelling case: a high-impact, long-life asset poised to deliver both financial returns and environmental impact in a supply-starved market.