The new metals age: the place of copper in the century ahead · The new metals age: the place of copper in the century ahead Jean-Sébastien Jacques ... Wood Mackenzie refined copper

CESCO 2015

The new metals age: the place of copper in the century ahead Jean-Sébastien Jacques

14 April 2015

Oyu Tolgoi, Mongolia

Copper climate

2

Copper price (LME cash, cents/lb)

Copper cost curve (C1 + sustaining, cents/lb)

Chinese GDP (Y/Y % change)

Wood Mackenzie refined copper balance (kt)

Source: Wood Mackenzie copper mine cost service, Q1 2015 dataset

Source: Wood Mackenzie copper market service, Q1 2015 dataset Source: Global Insight

1

2

3

4

5

Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15

Down 18%

since start of

2014

Down 40%

2011 peak

0

100

200

300

400

0% 20% 40% 60% 80% 100%

2011 2013 2015

Down 10%

since 2011

Down 15% from

peak in 2013

4

5

6

7

8

9

10

11

12

13

Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14

137

592

235 151 131

485

697

(27)

(235) (285)

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Past and present: innovation uses copper

3

Wright Brothers

1903 Ford

Boeing Dreamliner

Tesla Motors

Population growth and rising incomes in emerging regions will drive further growth into the next decade

4

The rise of the global middle class

led by emerging Asia

Growing electricity requirements in large emerging

markets will continue to support demand

Source: OECD Development Centre, Working Paper No. 285

0

10

20

30

40

50

60

70

0

1,000

2,000

3,000

4,000

5,000

6,000

2009 2020 2030

Po

pu

lati

on

(m

illio

ns)

North America Europe

Central & South America Middle East & North Africa

Sub-Saharan Africa Asia Pacific

Asia Pacific Percentage

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

0 10,000 20,000 30,000 40,000 50,000

UK USA ChinaJapan South Korea GermanyRussia Brazil India

Per

cap

ita e

lectr

icit

y c

on

su

mp

tio

n

(KW

h/c

ap

ita)

1970

-2012

GDP/Capita 2005 US$

5

Rio Tinto’s 4+2 copper portfolio

Four brownfield + two greenfield world-class copper projects

Kennecott Utah, USA

Resolution Arizona, USA

Escondida Chile

La Granja Peru

Grasberg Indonesia

Oyu Tolgoi Mongolia

New Metals Age: Future of Copper’

6

Copper alloy fishing nets Medical equipment Wind and renewable energy

Urbanization Rural electrification Copper indium gallium selenide

solar cells (CIGS)