Newmont Corporation’s CEO, Tom Palmer, has highlighted the mining industry’s potential for further consolidation, driven by surging demand for metals like copper needed in the energy transition and challenges accessing capital.
Speaking at an industry event in Melbourne, Palmer pointed to the surprisingly large new source of copper demand from artificial intelligence (AI) as a key factor. “It’s quite remarkable to see that move in AI that we didn’t see even two years ago,” he said, adding that the world will continue to see copper demand drive more buying opportunities in the mining sector.
The vast gold sector is also ripe for consolidation, according to Palmer, as companies face challenges in accessing capital while transitioning to become zero-carbon mines. The recent pursuit of rival Anglo American by top global miner BHP Group exemplifies the industry’s appetite for deals.
Following Newmont’s $17.14 billion takeover of Newcrest last year, the company is progressing with plans to divest eight assets, trim its workforce, and cut debt. Newmont is looking to offload mines and development projects in Canada, the U.S., Ghana, and Australia, and the CEO expressed excitement about the level of interest in these assets.
Palmer also highlighted the benefits Newmont has seen from the 15% jump in gold prices this year, with gold demand soaring due to global macroeconomic uncertainty. He expects central banks, as well as the middle class in China, India, and the U.S., to continue buying gold, with gold ingots “walking off the shelf” at U.S. supermarket chain Costco.
The Newmont CEO’s comments underscore the transformative forces shaping the mining industry, as companies navigate the evolving demand landscape and seek to optimize their portfolios to capitalize on emerging opportunities, particularly in the copper and gold sectors.