Mining in Australia is a relative no-brainer as the country is globally recognized as a leading producer of a wide range of minerals, including bauxite, iron ore, lithium, gold, lead, diamond, rare earth elements, uranium, zinc, and more. With over 350 operating mines, Australia extracts 19 useful minerals in significant amounts. The country’s rich and diverse mineral resources, coupled with a stable regulatory regime, have made it a hotspot for mining activities. Among the companies making notable strides in this sector is Inflection Resources, a Canada-based firm with operations in eastern Australia.
Inflection Resources (AUCU.C) is a pure exploration company, primarily focused on the discovery of large copper and gold deposits. The company, established in 2018, has built a substantial portfolio of projects in New South Wales, northern New South Wales, in particular, exploring a belt of rocks known to host some of Australia’s biggest mines.
In an interview with Jody Vance on “First Glance with Jody Vance,” Inflection Resources CEO and President, Alistair Waddell, provided an in-depth look at the company’s operations, its recent milestones, and his perspective on the gold and copper market.
“We’re focused on the discovery of very large copper gold deposits in eastern Australia, specifically in New South Wales,” Waddell said. He added that the company is exploring the northern extension of this belt, which is “known to host some of Australia’s biggest mines.”
What’s all this fuss about copper?
The copper market, an essential player in the global drive towards decarbonization, is gearing up for a significant challenge in the coming decade. The urgent need for widespread electrification is expected to boost annual copper demand to 36.6 million metric tons by 2031, a demand surge that current supply projections fall short of meeting. However, emerging technologies, if successfully commercialized and adopted industry-wide, promise to bridge the looming supply gap.
Copper, the cornerstone of electrification, has a pivotal role in achieving global warming targets. As the demand soars, the mining industry faces the daunting task of supplying the required volume of copper through traditional methods. This translates to increasing the volume of ore processed by another 44 percent by 2031. Out of the additional 1.6 billion metric tons of ore required, the gap remains a significant one billion tons per annum, further emphasizing the need to extract more metal from the ore being mined.
Despite the global economic slowdown due to the COVID-19 pandemic, copper prices have shown remarkable resilience. After hitting a four-year low in March 2020, they rebounded strongly to an all-time high of $4.92/lb in March 2022. This recovery was driven by increased manufacturing activity, a rebound in economic growth, low levels of global copper stockpiles, and constrained mine supply.
Furthermore, with China – the world’s largest consumer of copper – expected to see a growth in its GDP from 3.0% in 2022 to 5.2% in 2023, copper demand is expected to rise correspondingly. The anticipated surge in the manufacture of electric vehicles and the required expansion of electrical grids to support these vehicles’ usage is another significant factor that paints a positive outlook for the copper market in the coming years.
Why New South Wales?
Inflection Resource’s location in New South Wales is strategic, given that New South Wales (NSW), Australia, holds a rich portfolio of metallic and industrial minerals, making it a significant player in the global mining industry.
The region’s vast deposits include gold, copper, silver, nickel, lead, zinc, cobalt, lithium, mineral sands, clays, and limestone. These minerals are crucial to several modern industries including energy, communications, transport, and more, aligning NSW with the expanding global demand for such resources driven by a growing population, rising living standards, and swift technological advancements.
NSW holds the title of Australia’s second-largest gold-producing state. Key production sites near Orange, Parkes, and West Wyalong in the state’s Central West contribute significantly to this output. Newcrest Mining’s Cadia Valley Operations, one of Australia’s largest gold mines, also finds its home in this region.
In 2019, the NSW Government introduced a Minerals Strategy to support the growth of the NSW metals sector, addressing increasing global demand and improving the competitiveness of NSW as an investment destination. The strategy focuses on high technology application metals such as copper, silver, gold, rare earth elements like scandium, platinum group elements, and cobalt, lithium, titanium, and zirconium.
The mining industry has been an economic pillar in NSW for over 200 years, supporting employment, economic development, and public welfare. The industry has a rich history, with origins in convict mining and Australia’s first commodity export, coal, beginning near Nobbys Head in Newcastle in the 1790s. Today, Newcastle is the world’s largest coal export port, shipping approximately 160 million tonnes annually to markets across Asia.
NSW’s gold rush began in 1851 near Orange, leading to the establishment of gold and copper mining operations at Cadia Hill in 1870, which today houses Newcrest Mining’s Cadia Valley Operations. Numerous regional centers in NSW owe their establishment and development to mining, including Newcastle, Broken Hill, Wollongong, Cessnock, Maitland, Singleton, Muswellbrook, Lithgow, Orange, Parkes, Gunnedah, and Cobar.
Exploration progress
Inflection Resources has made significant progress in its exploration activities, as highlighted by a recent agreement with one of the world’s largest gold mining companies, Anglo Gold Ashanti. This multistage agreement will see the two companies explore across Inflection Resources’ portfolio of properties in New South Wales. This partnership is set to accelerate the company’s exploration activities, providing a substantial boost in their ability to drill more holes and explore deeper.
“We’re going to go from being relatively quiet in terms of news flow… to having a massive amount of news flow from at least two drill rigs,” Waddell said.
In conclusion, Inflection Resources is carving a niche for itself in the rich mining landscape of Australia. With its strategic exploration activities, backed by a robust partnership with Anglo Gold Ashanti, the company is well-positioned to make significant discoveries that could reshape the gold and copper markets.
To stay updated on Inflection Resources’ journey, follow them on inflectionresources.com. For any queries, you can reach out directly to Alistair Waddell at Alistair@inflectionresources.com or Brennan Zerb at Brennan@inflectionresources.com.
Inflection Resources currently trades at $0.21 CAD per share for a market cap of $18.43 million.
