US-based exploration company Ivanhoe Electric has completed a preeasibility study (PFS) for its Santa Cruz copper project in Arizona, confirming the viability of a high-grade underground mine and setting the stage for construction to begin in the first half of 2026.

The PFS outlines a 20 000 t/d underground operation producing 72 000 t/y of copper cathode in the first 15 years. Over a 23-year mine life, the project will deliver a total of 1.5-million tonnes of copper from 136-million tonnes of ore grading 1.08% copper.

Ivanhoe Electric plans to build a conventional on/off heap-leach facility on-site, enabling the production of LME Grade A 99.99% pure copper cathode without the need for smelting or cross-border processing.

Executive chairperson Robert Friedland said Santa Cruz would be among the first new copper mines to open in the US in a generation.

“Given global conflicts that concern us all, the United States is now awake to the urgent national security imperative to restore domestic American mineral production to the scale of the American economy. Our government, industry, and defence establishment clearly recognise the paramount importance of having a secure, domestic supply of all critical minerals in the twenty-first century, including copper,” said Friedland.

“Our progress to date could not have been achieved without the support of our long-term supportive investors, such as Saudi Arabia’s Maaden and BHP, the world’s largest mining company, and several of the world’s top institutional investors who understand the urgent need for domestic copper production. This is what the American mineral industry and resurgence must look like – clean, secure, strategic, and ready to support American national security.”

The study estimates an initial capital cost of $1.24-billion, with capital intensity of about $17 000/t of copper and C1 cash costs of $1.32/lb over the life-of-mine – ranking the project in the global first quartile.

At the current COMEX copper price of $4.83/lb, the after-tax net present value (NPV), at an 8% discount rate, is $1.9-billion, with an internal rate of return (IRR) of 24%. At a base case copper price of $4.25/lb, the NPV, using an 8% discount,  is $1.4-billion and the IRR is 20%.

President and CEO Taylor Melvin said the study reflected the dedication of a strong technical team and the quality of the Santa Cruz resource.

“I am proud of the extraordinary work by our Santa Cruz project team to complete our PFS on time and on budget. We have assembled a dedicated team of talented mine engineers and underground specialists who have been critical in getting us to this point.

“Working together with our expert industry consultants, our team’s tireless efforts have resulted in a highly engineered underground mine plan and a simplified heap-leach process design with low initial capital, low unit operating costs, and high copper recoveries.”

The project is situated on private land, which Ivanhoe Electric says will streamline permitting. First copper production is targeted for 2028.

Project financing is already in progress, supported by a letter of interest from the US Export-Import Bank for up to $825-million in debt funding under the Make More in America initiative.

Since exploration began in 2021, Ivanhoe Electric has drilled 329 holes totalling 279 000 m and invested over $100-million in technical studies.