Our TLDR
The transition to a low-carbon economy needs enormous quantities of raw materials – particularly metals – to deploy and scale. Congruent spent time with innovators, mining companies, academics, and investors to understand how biological approaches to mineral extraction – “biomining” – might reduce the cost, carbon footprint, and environmental impact of extraction and refining processes. This part of the mining space faces particular challenges regarding adoption and scalability. We are intrigued, but cautious, about investing in biomining.
Here's what we’re looking for at Congruent:
- Industry Lean-In: Demonstrated willingness from mining companies to work with startups on early-stage technology development and integration.
- Technology Readiness: Commercially relevant proofs-of-concept are necessary with at least high-level cost estimates for implementation in real-world environments.
- Credible Path to Scale: A clear go-to-market strategy and roadmap for integration with existing sites as well as a credible path to meeting the massive scale of large mining operations.
The Energy Transition: A Resource Question
A wide range of metals are essential to electrification, as well as the broader energy transition (see below for a breakdown by application from McKinsey).
Today, sourcing those metals has a considerable environmental impact: mining accounts for 4-7% of global GHG emissions and creates significant local water, air, and land quality concerns. Despite indications that the low-carbon economy will be significantly less extractive than the status quo, innovation is essential to unlock the growth in global metal supply necessary to support the energy transition while reducing environmental impact.
Our research led us to focus on copper due to its criticality across key technologies, lack of substitutes, acute supply concerns, and large market. Widespread — and growing — demand for copper across energy transition technologies is projected to create a mid- to long-term supply deficit. Meanwhile, decreasing copper ore quality coupled with the depletion of existing resources is driving extraction costs upwards; BNEF expects a ~30% reduction in the average copper ore grade this decade, with a decrease from 0.7% in 2020 to 0.5% in 2030.
The graphic below illustrates the main steps in the copper mining process. Copper is found in two main types of minerals: oxides (20% of global production) and sulfides (80% of global production). Pyrometallurgy, the high-heat (~1200 °C) and multi-step process through which most copper is processed today, is an energy-intensive process but is faster and higher yielding for sulfides and, therefore generally more economical than existing alternatives. In hydrometallurgy, copper is extracted from the orebody by applying aqueous solutions (often sulfuric acid) to dissolve and separate the valuable metal from the unwanted minerals. Developing efficient hydrometallurgical extraction methods for sulfides – particularly chalcopyrite, the most common copper sulfide, and thus the most common copper mineral – is the holy grail for copper extraction but impractical today because the sulfur creates a passivation layer that makes the metal unreactive and limits extraction. Biological approaches – or “bioleaching” – that bypass or prevent this effect could help sustainably unlock this valuable resource.
Overview of the Copper Mining Process
Biomining 101
Biomining leverages biological mechanisms to extract and recover metals from ores and waste materials, and broadly encompasses bioextraction (mostly heap leaching, where biological agents are applied to prepared piles of ore and then allowed to slowly perform their extraction processes without additional outside intervention), bioremediation (e.g., tailings remediation), and phytomining (engineering organisms, usually plants, to hyperaccumulate metals from the soil). From a climate perspective, biomining generally has a lower environmental impact than conventional approaches due to lower energy requirements (avoids or reduces energy-intensive steps like milling and smelting) and reduced chemical use. The microorganisms in question are also usually CO2-fixing autotrophs. Our research has led us to focus on biomining as applied to the heap leaching step in copper hydrometallurgy.
The use of biological processes in hydrometallurgy has been documented for centuries, but bioleaching did not gain significant attention in modern mining processes until recently due to limited understanding of microbial processes, technological limitations, and the dominance of conventional mining methods. Despite its long history, biomining remains niche, often limited to treating low-grade ores or complex sulfide deposits. Biological extraction methods accounted for just 1.2% of copper production in 2019-2020. Bioleaching tends to be slower than chemical methods, requiring larger tankage for equivalent throughput. In our view, the most notable impediments to biomining adoption are 1) scale up risk, 2) site specificity, 3) adoption risk, and 4) economics. Recent advancements such as the proliferation of low-cost sequencing and genetic engineering tools, as well as the commodification of bioreactors, have turned attention towards biomining as a viable approach to mineral extraction and generated a flurry of innovation.
The biomining ecosystem is nascent but quite broad. Many companies are developing processes applicable across multiple metals, ore bodies, and resources (e.g. applicable to both heap leaches and mine waste). The list below is not exhaustive but highlights the breadth of companies leveraging biology to unlock new metal supply (not just copper).
Biomining Companies At-A-Glance
Congruent’s Bull & Bear Perspectives
There are many reasons novel biological processes for copper extraction could be an exciting area for early-stage venture investment. Conversely, several technology and market dynamics could inhibit venture-scale outcomes for emerging companies. We’ve summarized our Bullish and Bearish views on this market below:
Enablers (Bull View)
- Supply Pressure: Ore grades are declining globally, and mining companies face increasing pressure on unit economics as the marginal cost of metal recovery rises. Mechanical and chemical approaches to improving recovery are reaching their limits and create environmental challenges. Biomining could offer a breakthrough in extracting copper from chalcopyrite, overcoming passivation layers that hinder current methods.
- Growing Tailings Liabilities: Tailings, the waste produced by mining operations, are a significant cost and liability for mining companies. The lack of additional tailings storage capacity is constraining future development, while regulatory and investor scrutiny are mounting. Biomining offers a solution by potentially reducing the volume and toxicity of tailings produced, managing environmental liabilities for mining companies while enabling supply expansion.
- Massive Market Opportunity: Copper is a highly traded global commodity with broad applications in industrial equipment, manufacturing, and electronics. With sulfide ores accounting for 80% of global copper production from sulfide ores, the target ore type for bioleaching, biomining presents a significant opportunity. If successfully commercialized and scaled across the industry, sulfide leaching could be applicable to ~2.4 million metric tons of McKinsey’s estimated 6.6 million metric ton copper supply gap by 2031 – a ~$45 billion opportunity.
Obstacles (Bear View)
- Scaling Biology is Challenging: Biological processes are intrinsically difficult to scale, particularly in industrial applications like mining where achieving consistent performance at a scale that matches the output of large mining operations has historically been challenging. Reaction environments must be tightly controlled to prevent contamination and maintain activity, adding complexity in scaling efforts.
- Highly Heterogeneous Operating Environments: Ore composition, microbiome, and environmental conditions vary across and within mine sites, requiring site-specific engineering of both microbes and process integration. This variability makes it difficult to engineer a repeatable, scalable process. Biomining technologies will likely require significant restudy and reconfiguration for each deployment.
- Customer Adoption Challenges: Mining companies are extremely risk-averse for very good reasons. They need to see significant improvements in throughput, purity, or yield with no risk to unexpected downtime for their operations. Long sales cycles and site-specific technology procurement make widespread adoption challenging. Additionally, many mining majors have in-house biohydrometallurgy expertise or hire specialized engineering firms, making it tough for startups to gain a foothold.
- Economics: The marginal additional yield for lower-value metals like copper may not justify the CapEx and OpEx investment necessary to implement a biomining approach. While this may make more sense for higher value metals like gold, those markets are much smaller and less important to the energy transition
Focus Areas
While biology has many potential applications in mining, biomining is still very niche. The long sales cycles associated with mining companies and the site-by-site specificity of mining operations are nontrivial impediments to scale. Congruent looks for companies that can quickly scale to produce outsized returns and impact. While we haven’t yet made an investment in this category, we have identified three potential areas where innovation could provide a significant unlock and may fit the venture model:
- Improving copper extraction from chalcopyrite (70% of world’s copper supply) – likely a breakthrough around overcoming passivation.
- A platform approach that leverages proprietary data and insights to help mines better engineer their biohydrometallurgy processes.
- Applying biology to “comminution” (the first process step in mineral extraction, which is grinding or milling the ore) to pre-condition the orebodies to reduce the energy required to crush the rocks, which also reduces energy downstream throughout the entire extraction process.
Please reach out if you are working in any of these areas, and we look forward to meeting entrepreneurs tackling these challenges head on!
Sources
- Sustainability By Numbers
- McKinsey [1, 2]
- GlobalData
- The International Energy Agency (IEA)
- Bloomberg New Energy Finance (BNEF)
- Springer [1, 2]
- University of Arizona
