Copper's Big Break: Resolution Project Approval Sparks Investment Momentum
125min read The U.S. Forest Service’s approval of a land swap for the Resolution Copper project marks a pivotal moment for the U.S. mining sector and investors in critical minerals. This long-awaited decision unlocks one of the world’s largest untapped copper deposits, nestled beneath Arizona’s Tonto National Forest, and sets the stage for a project that could supply 10% of the nation’s copper needs for decades. For investors, the approval isn’t just a regulatory win—it’s a signal of growing momentum behind copper as a cornerstone of the energy transition and a strategic asset in a resource-constrained world.
The Resolution Project: A Mega-Mine in the Making
The Resolution Copper project, a joint venture between BHP (BHP) and Rio Tinto (RIO), aims to extract an estimated 1.7 billion tons of copper ore from a site near Superior, Arizona. The land swap approval resolves a decades-old impasse with the federal government, allowing the companies to swap 2,420 acres of federal land for 5,300 acres of privately held property to be preserved as wilderness. This deal not only clears a critical regulatory hurdle but also positions the project to begin construction as early as 2025, with first production targeted for 2030.
Why Copper Matters Now
Copper’s role in the energy transition is non-negotiable. Every electric vehicle contains 80 pounds of copper—four times the amount in a conventional car—while wind turbines and solar infrastructure rely heavily on the metal. With global copper demand projected to surge 40% by 2030 (per the International Copper Association), the Resolution mine’s potential output of 860,000 tons annually could ease supply constraints at a critical juncture.
The strategic significance of domestic production cannot be overstated. The U.S. imports over 70% of its copper, with top suppliers including Chile and Peru—regions prone to political volatility and export disruptions. The Resolution project, if successful, would reduce reliance on foreign sources and bolster supply chain resilience.
Data-Driven Momentum
Investors tracking BHP and Rio Tinto can see how the project’s progress has influenced their valuations.
BHP’s shares have risen 28% year-to-date through early October 2023, outperforming the S&P 500, while Rio Tinto’s stock has gained 19% over the same period. Analysts at Goldman Sachs estimate the Resolution project could add $15 billion to BHP’s net asset value, though the firms’ broader exposure to commodities like iron ore and oil also plays a role in their performance.
Navigating the Risks
The project isn’t without hurdles. Environmental groups oppose the mine’s potential impact on groundwater and sacred Native American sites, and legal challenges remain possible. Meanwhile, copper prices—currently trading around $3.40 per pound—must hold steady to justify the $5.6 billion development cost.
Yet the macro backdrop favors the bulls. Copper futures have surged 25% since early 2022 as supply shortages in top-producing countries (Chile’s droughts, Indonesia’s export bans) collide with surging demand. The U.S. Inflation Reduction Act’s incentives for domestic critical minerals production further sweeten the deal for Resolution.
Conclusion: A Copper-Clad Opportunity
The Resolution Copper approval is more than a single project milestone—it’s a catalyst for a broader shift in how investors view copper. With global reserves dwindling and demand set to explode, the Resolution project’s scale and strategic positioning make it a rare opportunity to secure exposure to a metal that will underpin the energy transition.
For investors, the case is clear: BHP and Rio Tinto are well-positioned to capitalize on this project’s success, while copper ETFs like COPX or mining stocks with exposure to U.S. assets could benefit from the supply boost. As the world scrambles to electrify its infrastructure, Resolution’s green light isn’t just good news for Arizona—it’s a win for anyone betting on copper’s enduring importance.
The final tally? The Resolution project’s approval is a rare win for U.S. resource independence and a compelling entry point for investors aiming to profit from the metal that will power the 21st century.
