China’s Zijin Mining Group Co. is actively strategizing to expand its copper mining operations in eastern Serbia, driven by the surging demand for this critical metal in the context of the global energy transition. This expansion initiative could potentially entail investments reaching billions of dollars.
Approximately two years ago, Zijin Mining initiated the Cukaru Peki copper and gold mine with a substantial $678 million investment, allowing them to access reserves located a few hundred meters deep. Now, the company is considering an ambitious plan to drill to depths of almost 2 kilometers (1.25 miles) to fully harness the assets acquired during a takeover spree.
Branko Rakocevic, the top Serbian official overseeing the mine, who was authorized by the Chinese company to speak with the media, stated, “These are vast reserves, which require additional infrastructure, additional investment of around $3.5 billion to $3.8 billion.”
Globally, both companies and governments are actively pursuing the production of materials essential for the transition toward a greener economy. Copper, in particular, plays a crucial role in wind turbines, power grids, and electric vehicles. While China is currently the world’s leading supplier of these critical minerals, the European Union and the United States are striving to bolster domestic supplies to remain competitive in this transformative shift.
Serbia, an EU candidate, has welcomed foreign investors, including China, as part of its efforts to revive a struggling sector of its economy. Australia-based BHP Group, the world’s largest mining company, has also demonstrated interest by signing an agreement earlier this year to explore new copper deposits in the country.
Cukaru Peki is situated in the town of Bor, which has a mining history spanning over a century, focusing on copper, gold, and silver. The mine’s deeper zone, at depths exceeding 460 meters (1,508 feet), is believed to hold 2.2 million tons of copper, surpassing the upper zone in copper reserves. However, the gold content at greater depths is expected to be lower.
Rakocevic anticipates that the upper zone may be depleted of its deposits by around 2034, while deeper mining operations could commence in 7 to 10 years. Zijin’s long-term vision for the site involves infrastructure development, including road construction, expanding the power supply, and enhancing flotation facilities.
Zijin’s expansion in Serbia began with the acquisition of the country’s sole copper and gold complex in 2018, a move made by the government to salvage thousands of jobs in an economically challenged mining region. Through subsequent acquisitions, Zijin has secured full control of what is now the Cukaru Peki mine. These strategic moves, along with additional investments to expand operations in Congo and Tibet, are positioning Zijin as one of the world’s largest copper producers, surpassing Western competitors like Rio Tinto, Anglo American, and Antofagasta. The company aims to produce approximately 1.2 million tons of copper by 2025, marking a six-fold increase compared to 2017 levels.
Zijin currently operates two units in Serbia. One unit produces copper cathodes, gold, silver, and sulfuric acid in collaboration with the government, while the other, Serbia Zijin Mining, operates the Cukaru Peki mine and exports copper concentrate to several countries, including China, Canada, Bulgaria, Spain, and Korea.
Both units have been among Serbia’s top exporters for the past two years, capitalizing on the soaring demand for metals. Although benchmark copper futures experienced a significant surge earlier this year, prices have since moderated, largely due to concerns about China’s economic health. Nevertheless, Rakocevic remains optimistic, stating, “Still, copper is in demand always and everywhere,” which justifies the company’s long-term investment. “The market is stable enough. Prices declined from last year, but we don’t expect much volatility.”
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