Amid the data center "copper rush," Ivanhoe Electric's (IE.US) top-tier new copper mine in the US becomes a highly sought-after asset.

As the rapid expansion of data centers and power grids drives up copper demand, mineral exploration and development company Ivanhoe Electric (IE.US) is in advanced talks with potential buyers regarding copper output from its Arizona project. Chief Executive Officer Taylor Melvin said in an interview that copper from the Santa Cruz mining project has attracted interest from traditional traders as well as potential strategic partners seeking to secure supply for U.S. industry. He declined to name the parties involved in the negotiations. In the race to build infrastructure for artificial intelligence, global copper supply is tightening, with copper prices hovering near record highs. Ivanhoe Electric, founded by mining billionaire Robert Friedland, holds a portfolio of mineral projects including Santa Cruz and is working with the U.S. government's export credit agency on a debt financing package of up to $1.1 billion for the mine. Melvin said that as global copper demand growth outpaces supply, the U.S. need for new domestic capacity is particularly urgent. The CEO said, "To fill this gap, we need far more than just the Santa Cruz project." He added that offtake agreements for the Santa Cruz project may include financing arrangements. In addition to the proposed debt deal with the Export-Import Bank of the United States, Ivanhoe Electric is also discussing project financing with about a dozen commercial banks. As new data center deals close rapidly, those copper-intensive large cloud service providers have begun locking in future supply. Processes that can accelerate copper production are highly attractive to buyers. Earlier this year, Amazon.com, Inc. agreed to purchase copper from a Gunnison Copper mine in Arizona, produced using Rio Tinto plc Sponsored ADR Group's proprietary leaching technology, which eliminates the need for traditional smelting and refining, ultimately destined for Amazon.com, Inc.'s data centers. Melvin said Santa Cruz will use an in-situ process relatively new to the U.S. to produce cathode copper, bringing buyers one step closer to products such as wire rod, cable and copper foil. Ivanhoe has been promoting this process as part of its low-emission operating plan. The project's first phase is expected to cost $1.4 billion, with first production targeted for 2029. Melvin said that when combined with adjacent resources, Santa Cruz has the potential to become one of the top copper districts in the United States.