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(Bloomberg) — South32 Ltd. plans to prioritize growth in metals such as copper and zinc over aluminum, where it has decided to shut a major African smelter.
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The Perth-based miner has no plans to replace volumes from the Mozal plant or expand its footprint in aluminum, Chief Executive Officer Graham Kerr said in a telephone interview. The company sees more “attraction and spending in zinc and copper over aluminum,” he said.
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“We want to grow copper and zinc exposure to be more than our alumina and aluminum business,” Kerr said. “We’re not planning to spend more capital in aluminum outside current safe, reliable and small improvement opportunities.”
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Copper prices have outpaced those for aluminum over recent years. The metal has been a sought-after element in recent mega-merger discussions among miners, because of its role in electrification, data centers and the energy transition.
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The copper and zinc business is delivering returns of 45% to 70%, compared with 15% in aluminum, Kerr said.
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South32 said late last year it would put the Mozal smelter — one of Mozambique’s biggest employers — into care and maintenance in March, when the current electricity contract ends.
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“There has been some inbound interest in Mozal, but our primary focus for now has been on site closure,” Kerr said.
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South32 on Thursday said net profit rose 29% from a year earlier in the six months through December, to $464 million. The company’s shares reversed earier gains to trade down 3% as of 4:16 p.m. in Sydney, paring their year-to-date gain to 27%.
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Since it was spun out of BHP Group, South32 has exited coal, sold non-core and complex assets, and focused on base and battery metals. Its core growth project is the Hermosa underground zinc-lead-copper mine in Arizona.
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South32 is also progressing exploration at the Ambler copper project in northwest Alaska, alongside partner Trilogy Metals Inc. The Trump administration acquired a 10% interest in Trilogy last year, which is also backed by billionaire John Paulson.
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