Copper miner Freeport-McMoran has unveiled a plan to increase its output by 90,000 tonnes by using artificial intelligence at its mines.
“We have set an aspirational goal of adding 200m pounds (90,000 tonnes) of copper from these initiatives with very little capital investment,” Richard Adkerson, the company’s CEO, said in a recent interview with the Financial Times.
Freeport has tested the technology at its Bagdad mine in Arizona and expects to roll it out across all of its operations in the Americas. Adkerson said the Bagdad trial increased production by 9,000 tonnes.
The technology, as described by Freeport, uses data from sensors to suggest new ways to improve the performance of crushers and processing mills. At the Bagdad mine, the technology found that the mine could recover more copper by adjusting pH level.
Freeport’s plan comes following its poor performance in Q3 2019, when it saw a drop in sales and production. The company struggled due to disruptions in Peru and the slow-going process of transitioning its Grasberg mine from open pit to underground, which has impacted output.
The company posted a net loss of US$131 million for Q3 and only sold 795 million pounds of copper, compared to its estimate of 830 million pounds. The company had predicted this downturn to some extent since it knew of its plan to transition the Grasberg mine. Freeport did not, however, predict the anti-mining protests.
Despite the company’s struggles, Adkerson remains optimistic regarding the future, with high goals.
“… (We) remain focused on successful execution of our plans, which would enable us to increase copper production by 30 percent, gold production by 70 percent, reduce unit net cash costs by 25 percent and more than double operating cash flows in 2021 from 2019 levels,” he said in the firm’s Q3 release.
Since the announcement, Freeport’s share price has increased, opening the market on Monday at US$10.76, up 2.4 percent from its closing price last Friday (November 1).
At 10:23 a.m. EST on Monday, Freeport’s share price was at US$10.74, and at 10:24 a.m. EST, Zijin Mining’s share price was HK$2.83. As of last Friday, copper was trading at US$5,795 per tonne.
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Securities Disclosure: I, Sasha Dhesi, hold no direct investment interest in any company mentioned in this article.