‘Green’ copper company wants stock exchange listing, with plans to raise R100m in capital

Big Tree Copper, which describes itself as a green copper processor, is targeting a listing on either the JSE or Cape Town Stock Exchange in the first half of this year, with plans to raise more than R100m in capital when it comes to market.

Environmental conservation is not exactly synonymous with copper production in the South African context historically, but the nearly three-year-old Big Tree Copper said it has been changing that with its technology at its Nababeep site near Springbok that extracts copper from existing tailings dams and “previously misidentified waste rock piles” left behind by previous miners in the Northern Cape.

The company said these so-called waste piles are “copper oxide ore rock”.

Headed by Jan Nelson, a former CEO of Pan African Resources, the company said it is the only pure copper producer in SA, and that through its “rehabilitation process and over ground process” at its plant, which cost about $6m (about R91.9m) to build over three years, it extracts copper from old tailings dams and waste rock piles. The group treats what is left with chemicals to restore it and make it environmentally neutral.

The company has caught the eye of some high-profile investors, with funds managed by Coronation Fund Managers taking up a stake of just under 6% before the planned listing. Executive management and the board hold close to 60%, with the plan to target a free float of 30% to 35% for investors to buy shares at listing.

The group also plans to give a 15% stake to the community and employees of the company, all of whom come from the surrounding community, with Nelson saying “there will be no strings attached” such as share lock-in periods, as it is “the right thing to do”.

While 90 people are employed from the community at the moment, they plan to increase this over time.

“The community of Nababeep has about 5,500 people, of which about 70% are unemployed. Every morning when we stop at the gate of our plant there are 30 to 40 people looking for work. They stand there in their overalls and safety gear ready to work. That’s quite a desperate situation.

“We have employed about 90 people in six months and will employ more. We only employ people from Nababeep.”

Nelson believes the group can make “good money” and “leave a legacy and change the town and people’s lives”.

“We are not about building swimming pools and hockey fields for people because what do I tell the knitting club if I give the soccer club money? We provide jobs and pay our people well and will give a certain percentage of the company to the community. Let them own part of the company.”

Explaining the history of the company, Nelson said he, financial director Stephan du Plessis and chair Rupert Smith had “always wanted to form a company like this” and copper “piqued our interest”.

He said there is a “copper supply crunch” globally, which will likely support the current high prices. Copper has a host of uses in construction, wiring, piping and electrical transmission lines.

Add to this the “electric car revolution”, said Nelson, and demand is expected to continue increasing.

“Each EV [electric vehicle] contains 85kg of copper and if you look at only 30% of the world going to EVs by 2040, we are going to need 42-million tons of copper annually. That’s roughly twice the current demand. There is no other metal that can substitute for copper.  The fundamentals are strong so that's why we are focused on copper.”

Nearly three years ago, the desire to start a copper company led them to the Northern Cape, which in its heyday, between the 1940s and 2000s, had produced more than 1.5-million tons of copper.

Nelson said by the time they went to look, only the SHiP copper company was in the region.

 We went to Nababeep and were looking to find a copper deposit or joint venture and through an association with the SHiP company, run by Shirley Hayes. We spoke to her and she led us to rock dumps in Nababeep. When we walked on them we noticed there was copper oxide. It is very easy to see copper oxide because it’s green.”

It dawned on them there was potential to produce copper from what was previously viewed as waste, while rehabilitating the environment.

“I think people didn’t go and look. The big mines were mined out. They saw the waste and assumed there was no copper. It’s not that we were more clever, but we were at the right place at the right time. We walked on the rocks and saw we could process it,” Nelson said.

He said the copper price had run very strongly, which made it financially viable to use the technology of the group’s Nababeep SX/EW Copper Oxide Plant.

Nelson said there is probably a 30-year supply in Nababeep.

The group also has Noble Metals as its offtake partner.

SHiP, which has been in the area for 10 years, plans to begin underground mining in the next year and Big Tree, through its association with it, will use its technology to extract copper from that company’s tailings dams. It will rehabilitate the ground to its natural state.  ​

Business Times