This story is part of The Salt Lake Tribune’s ongoing commitment to identify solutions to Utah’s biggest challenges through the work of the Innovation Lab.
[Subscribe to our newsletter here]
Utah’s Kennecott mine on the west side of Salt Lake County is getting a $918 million investment intended to extend the life of the mine as electrification fuels demand for more copper.
Kennecott’s owner, Australia-based Rio Tinto, said it will spend $498 million to develop an underground mine in an area called the “North Rim Skarn,” from which the company hopes to extract 250,000 tons of copper over the next 10 years. At today’s copper price of roughly $3.80 per pound, that would be $1.9 billion in copper. The mine also produces smaller amounts of other minerals.
After more than a century of mining what was once the largest open-pit mine in the world, Kennecott last year began mining underground in the “Lower Commercial Skarn.” The company also continues to produce copper ore from open-pit operations.
As required by Australian law, Rio Tinto characterized the copper in the North Rim Skarn as “inferred,” meaning the company expects to find sufficient copper but it hasn’t been verified yet. “There is no certainty that further exploration work will result in the determination of indicated mineral resources or that the production target itself will be realized,” the company said in its news release.
The investment also could extend the life of the mine past its current 2032 estimate, said Clayton Walker, chief operating officer for Rio Tinto’s Copper Division. “We’re working on how to extend it to 2050, but we don’t have all the data on that yet.”
The mine opened in 1904 and has been a backbone of the state for more than century and employed generations of workers. Walker estimated Kennecott’s operations contribute about $1.4 billion annually to the Utah economy.
But the mine and smelter also have raised concerns from environmental groups because of the large quantities of toxic materials produced. The only other copper smelter in the country is in Globe, Ariz., which is far from Arizona’s population centers.
Like the first underground mine, the new mine will use battery-powered mining equipment. The massive vehicles have detachable batteries so they can be swapped out without charging delays.
(Chris Samuels | The Salt Lake Tribune) The battery unit of a Sandvik mining vehicle is on display during an event at the Bingham Copper Mine, Tuesday, Sept. 27, 2022. Mine operator Kennecott unveiled the battery electric vehicle that will operate to extract copper from tunnels in the mine.
Underground mining costs more than pit mining, but that cost is offset by richer ore. While ore mined on the surface is about 1% copper, the underground ore is expected to be 2% or higher.
Rio Tinto also is spending another $300 million for what it calls the largest rebuild of its Magna smelter in history. And another $120 million will be spent to upgrade the refinery’s tank house, where copper is extracted from a solution, and its “molybdenum flotation circuit.” Molybdenum, which is used in steel alloys, is one of several minerals Kennecott extracts from its ore in addition to copper.
The mine and smelter also produce gold and silver, and Kennecott recently started producing tellurium, an element that is used in solar panels. The company also produces and sells sulfuric acid to industrial customers, Walker said.
This investment comes on top of a $1.5 billion investment the company made in 2019. Walker noted that electric cars require about four times more copper than a combustion vehicle, which has made it a key material in the clean energy transition. The mine supplies about one-eighth of the copper used in the United States.
Kennecott is also the biggest generator of toxic chemicals in the state, according to the EPA’s Toxic Release Inventory. The mine and the smelter combined generated more than 175,000 pounds of toxic chemicals in 2021, mostly copper and lead compounds that are contained in the company’s waste dumps.
“HEAL Utah recognizes that critical minerals will play a role in our transition to clean energy,” said Meisei Gonzalez, communication director for Health Environmental Alliance of Utah (HEAL Utah). “However, we can’t ignore the environmental and social impacts of mining for these materials. It is essential that companies like Rio Tinto prioritize transparency, consent, and accountability in their practices to avoid more social and environmental crises down the road.”
Follow @@timmyfitz