Bernstein: A new lead in copper leaching: Can Freeport’s breakthrough unlock low-grade resources?

Why does Freeport’s new lead matter?

On its third-quarter earnings call, Freeport said recovery rates in its leaching tests continued to rise as leaching time increased and could eventually compete with concentrator recovery rates. Bernstein noted that conventional leaching recovery rates typically level off after several quarters; the firm believes Freeport may have evidence of success or failure after about four quarters.
Over the past 25 years, average recovery rates in copper ore concentration have remained roughly stable at 85%, while average leaching recovery rates have fallen from about 75% in the early 2000s to about 65%. Higher recovery means more copper can be produced from the same ore, spreading unit costs over more output.

About 70% of global copper resources are contained in low-grade primary sulfide ores. Copper can be extracted from these ores, but conventional smelting and leaching have long been uneconomic; chalcopyrite, in particular, forms a passivation layer during leaching that impedes further copper extraction.
Conventional leaching of primary sulfide ores has a recovery rate of about 10% to 30%, below the roughly 65% achieved in ordinary leaching operations. Bernstein believes both Freeport’s recently filed patent relating to alkyl thiosulfonates and Jetti’s technology aim to reduce the obstruction caused by the passivation layer.
The technology must also suit the ore and site conditions. In an experiment cited in the report, a 1-meter-high leaching column achieved a recovery rate above 30% after 30 to 40 days; commercial ore heaps can be tens of meters high, and leaching may take several times as long as in small-scale tests.

Freeport’s leaching program reached an annualized incremental production rate of about 240 million pounds per year in 2025. Its next targets are 300 million pounds by the end of 2026 and 400 million pounds by the end of 2027, with a long-term target of about 800 million pounds per year by 2030. Bernstein believes progress during the expansion phase has been slow.
The incremental output must also be viewed against declining existing production: Freeport’s U.S. leaching operations produced 832 million pounds of copper in 2025, down 21% from 2020, mainly due to lower average ore grades and less ore being placed on heaps.
The company’s above-ground ore stockpiles contain more than 40 billion pounds of copper, most of which Bernstein believes is in primary sulfide ore. Simply spreading the contained copper evenly over 20 years gives a scale reference of 2 billion pounds per year; actual production also depends on how much copper can be recovered.
Other miners are also advancing projects: BHP’s Spence primary sulfide leaching project is expected to be completed or begin production in 2027–2028, with potential annual copper output of 30 thousand–40 thousand tonnes. Bernstein judges that industry technology is gradually improving, but expected incremental output remains limited relative to the potential supply shortfall in the 2030s.

Bernstein estimates that, using existing waste-rock heaps with no additional mining costs, a recovery rate of just 30% would imply operating costs of about 7000 dollars per tonne. The estimate uses ordinary leaching cash costs of 5000 dollars per tonne, of which 70% is processing and administrative expense, with a 60% recovery rate as a comparison.
Assuming capital intensity for new facilities of 4400 dollars per tonne of annual capacity and a five-year project life, capital costs are about 880 dollars per tonne, taking total costs to about 7880 dollars per tonne. Miners must also consider their long-term planning copper price: Bernstein believes copper may need to remain above 11000 dollars per tonne over the long term to persuade some conservative miners to raise their planning price to around 10000 dollars per tonne.
Bernstein is interested in the outlook for leaching but maintains its market-perform rating on Freeport because of concerns about tariff decisions.