(Reuters) - Rio Tinto Ltd said on Monday it would invest an extra $302 million to develop its Resolution copper project in the U.S. state of Arizona, as it looks to expands output to meet the lucrative market for new energy vehicles.
The funds will be used bank-roll additional drilling, ore-body studies, infrastructure improvements and permitting activities with the miner aiming to advance the project to the final stage of the permitting phase, it said in a statement to the Australian Stock Exchange.
Resolution, owned 55 percent by Rio and 45 percent by BHP Group, is one of the “most significant undeveloped copper projects in the world”, Chief Executive Jean-Sébastien Jacques said.
“The comprehensive permitting process is well underway with the environmental impact study on track to be completed next year according to the regulators schedule,” Jacques added.
Copper has become a hot-commodity thanks to an expected boom in production of electric vehicles, which use twice as much copper as internal combustion engines.
“The rise of electric vehicles, battery storage, new transmission technology and other green energy innovations are highly copper intensive. We need to prepare now to meet this future demand,” Jacques said.
In February, Rio said it made a promising find of copper, gold and silver at its Winu prospect in Western Australia.
Miners have begun to spend more on replenishing their pipelines after a price recovery in recent years allowed them to repair their balance sheets following the commodity bust of 2015-16.
Reporting by Aditya Soni in Bengaluru; editing by Richard Pullin