Sacred Land or Strategic Asset: The Resolution Copper Mine’s Legal Battle and Investment Implications

The U.S. copper industry faces a pivotal moment as a federal judge’s temporary injunction halts progress on the $6.8 billion Resolution Copper Project—a joint venture between Rio Tinto (ASX: RIO) and BHP (ASX: BHP). The project, which aims to supply 7% of U.S. copper demand, is now mired in a legal battle over a sacred Apache site, Oak Flat (Chi’chil Biłdagoteel). This clash between Indigenous rights and mineral extraction has far-reaching implications for investors, geopolitical strategy, and the energy transition.

The Legal Stakes

On May 9, 2025, U.S. District Judge Steven Logan issued a temporary injunction blocking the Trump-era land transfer of Oak Flat to Rio Tinto and BHP. The ruling hinges on the Apache Stronghold’s claim that the Religious Freedom Restoration Act (RFRA) protects their rights to worship at the site, which the mine would destroy. The Apache argue that Congress’s 2014 authorization of the land swap—a provision in a defense bill—did not adequately consider religious impacts.

The case now awaits the Supreme Court’s decision on whether to hear Apache Stronghold v. United States, with a ruling expected by late 2025. If the Apache prevail, the land transfer could be permanently blocked, derailing the project. A ruling for the companies, however, would clear the path for construction.

Market Impact: Copper’s Crucial Role

The Resolution Copper Project is a linchpin for U.S. energy security. Its 40 billion-pound copper reserve—critical for EVs, solar panels, and defense systems—could reduce reliance on imports (75% of U.S. copper is imported). The mine’s high-grade ore (1.52% copper) offers cost advantages, with projected production costs of $2,800/ton, far below current prices of ~$3.70/lb ($8,160/ton).

Investors should note:
- Upside: If approved, the mine could generate $61 billion in economic activity over its 40-year lifespan, including $20 billion in tax revenue. Rio Tinto’s 55% stake positions it to benefit most, while BHP’s 45% share would also bolster its copper portfolio.
- Downside: Legal delays risk escalating costs, with Rio already reporting $11 million/month in maintenance expenses for existing infrastructure. A Supreme Court setback could trigger a sell-off, given the project’s $6.8 billion valuation.

Key Risks

1. Legal Uncertainty: A Supreme Court ruling against the Apache could still face years of appeals, pushing production timelines to the late 2030s.
2. Environmental Opposition: Groups like the Sierra Club highlight water usage (250 million gallons annually in a drought-prone region) and subsidence risks, which could delay permits.
3. Geopolitical Tensions: China’s dominance in copper refining (40% global capacity) and U.S. reliance on South American imports heighten the urgency of domestic projects.

Strategic Considerations for Investors

• Rio Tinto and BHP: These stocks could rise if the Supreme Court upholds the land transfer, but prolonged legal battles or a negative ruling could pressure valuations.
• Copper Market: Approval of Resolution could ease global supply deficits (projected at 6–8 million tons by 2032), moderating price spikes. However, delays might push prices toward $12,000–15,000/ton by 2028 as EV demand surges.
• Economic Trade-offs: The project’s 3,700 construction jobs and 1,500 permanent roles underscore its economic value, but Indigenous sovereignty and environmental costs remain unresolved.

Conclusion: A Crossroads for U.S. Mineral Policy

The Resolution Copper Project’s fate will define whether the U.S. prioritizes energy transition needs or Indigenous rights. With copper prices already up 40% since 2020 and global demand set to double by 2035, the mine’s strategic importance cannot be overstated.

However, the Apache’s RFRA argument—backed by a district court’s recognition of “irreparable harm”—adds a new layer to Indigenous rights jurisprudence. A Supreme Court ruling for the Apache could establish stricter protections for sacred sites, reshaping future resource projects. Conversely, a win for Rio Tinto and BHP would affirm Congress’s authority to override tribal concerns, accelerating critical minerals development.

For investors, the calculus is clear: Resolution’s approval would boost Rio Tinto and BHP’s growth prospects while alleviating U.S. supply chain risks, but the legal and environmental hurdles remain formidable. Monitor the Supreme Court’s decision closely—this ruling will set the tone for decades of resource extraction and Indigenous rights in the U.S.

Data sources: U.S. District Court rulings, Apache Stronghold legal filings, Rio Tinto/BHP investor presentations, U.S. Geological Survey, International Copper Association.