Resolution Copper Stumble: Indigenous Rights and Investment Risks in Critical Minerals

A U.S. federal judge’s May 2025 ruling to halt the land transfer for the Resolution Copper mine has reignited a decades-long legal and ethical battle between Indigenous rights advocates and multinational mining giants Rio Tinto (RIO) and BHP (BHP). This temporary injunction, while not a final decision, underscores the escalating risks for investors in critical mineral projects tied to environmental, social, and governance (ESG) conflicts. Here’s why the case matters for portfolios and the future of U.S. energy transition plans.

The Legal and Cultural Stakes

The Resolution Copper mine, a $5.6 billion joint venture between Rio Tinto (55%) and BHP (45%), aims to extract 40 billion pounds of copper—a critical mineral for electric vehicle batteries and renewable energy infrastructure. The land swap, approved by Congress in 2014, transfers Oak Flat (Chi’chil Biłdagoteel) from federal ownership to the mining companies. However, this site is sacred to the San Carlos Apache, who argue that its destruction violates their religious freedom under the Religious Freedom Restoration Act (RFRA) and an 1852 treaty.

U.S. District Judge Steven Logan’s injunction, issued in late May, hinges on the likelihood of success for Apache Stronghold’s pending Supreme Court appeal. The judge dismissed Rio Tinto’s financial claims—$2.7 billion already spent and $11 million monthly maintenance costs—calling them a “voluntary choice” that does not outweigh the Apache’s “irreparable harm.” This marks a significant judicial shift, prioritizing Indigenous rights over corporate interests in federal land disputes.

Implications for Rio Tinto and BHP

The temporary delay could be costly for both companies. Rio Tinto has already spent years and billions on the project, with its stock price under pressure since 2021 amid regulatory delays. The injunction adds further uncertainty to a timeline already pushed to 2026 at best.

Investors should monitor:- Cost escalation: Delays could force Rio Tinto to absorb higher capital expenditures (CAPEX) and operational losses.- ESG reputation risk: The project’s association with Indigenous rights violations may deter ESG-conscious investors, especially as copper demand surges for EVs.- Supply chain geopolitics: The U.S. relies on China for 50% of its refined copper imports; Resolution Copper was seen as a key step toward reducing this dependency.

Broader Industry Context

The Resolution Copper case reflects a global trend: Indigenous communities are increasingly challenging extractive projects in courts and public opinion. In Brazil, the Amazon’s Yanomami have stalled gold mining; in Canada, the Muskrat Falls hydro project faced Indigenous opposition. Such conflicts are becoming non-negotiable risks for resource companies.

Meanwhile, copper prices—already volatile due to China’s demand swings and supply bottlenecks—could see further volatility if the mine’s future remains unclear.

The Supreme Court’s Role

The case’s fate now rests with the U.S. Supreme Court, which has delayed its decision for over a year. The Court’s eventual ruling on Apache Stronghold v. United States (24-291) will set a precedent for balancing RFRA protections with federal land-use policies. If the Court upholds the land swap, it could greenlight similar projects; if not, it may trigger litigation for other mines on Indigenous lands.

Conclusion: Risks and Opportunities for Investors

The Resolution Copper mine is a microcosm of the tension between ESG priorities and critical mineral demand. For Rio Tinto and BHP shareholders:- Short-term risks: Delays could pressure RIO and BHP stock, particularly if the Supreme Court blocks the project. Rio Tinto’s shares have underperformed peers since 2021, down 15% compared to BHP’s 5% rise.- Long-term upside: If the mine proceeds, it could deliver 40 billion pounds of copper over its 40-year lifespan, bolstering U.S. energy security and reducing reliance on Chinese imports (currently 50% of U.S. refined copper).

Investors should also consider:- Diversification: Exposure to other critical mineral plays (e.g., lithium, cobalt) or ESG-compliant mining firms.- Policy shifts: A U.S. federal buy-American policy or Indigenous consultation mandates could reshape the project’s viability.

In the end, the Resolution Copper case isn’t just about copper—it’s about whether the U.S. can reconcile its energy transition goals with Indigenous sovereignty. For investors, this means watching not just stock charts, but courtrooms.