Glencore has confirmed it has reached a Heads of Agreement with the Australian and Queensland governments on an A$600 million support package that will keep operations continuing for the next three years at the Mount Isa copper smelter and Townsville copper refinery.
The deal, made after eight months of constructive engagement with both governments, offers “greater certainty” for 600 workers and their families in Mount Isa and Townsville, the miner said, and also recognises the Mount Isa copper smelter and Townsville copper refinery as strategic national assets for the copper supply chain across Queensland and the country’s critical minerals strategy.
“The support package includes several review points and a commitment to complete a transformation study that will examine opportunities to further develop industrial capabilities in the Mount Isa region to ensure long-term economic resilience. The parties will now begin discussions to finalise the detailed formal agreement,” Glencore officials said, adding that, for over 20 years, Glencore’s Queensland metals operations have been an economic anchor for North Queensland’s pit to port copper, zinc, lead and silver supply chain.
Since 2003, Xstrata and Glencore combined have made capital investments of an estimated $10 billion into the Queensland Metals business and spent approximately $30 billion on day-to-day operating costs.
“Our Mount Isa Mines copper smelter is the only smelter in the country that treats products from local and regional mines as well as across Australia. The copper smelter and refinery are at the centre of an economic network that provides jobs for many thousands of people and partners with thousands more suppliers, making a substantial positive economic contribution from Mount Isa to Brisbane,” the company noted.
Over the next six years, Glencore has $2.5 billion in planned or proposed capital investment across the Mount Isa region. This includes further investment in George Fisher mine and potential development of the Black Star Open Cut (BSOC) project.
“This agreement provides a short-term lifeline for the copper smelter and refinery and comes after Glencore had already stepped up to absorb significant financial losses to maintain operations and jobs while working on a solution with government,” Australia interim chief operating officer Troy Wilson confirmed.
“On behalf of Glencore and our workers, I would like to express thanks to the Australian and Queensland governments for backing the region and these strategic assets with a critical support package. In particular, I want to sincerely thank our workforce, whose commitment and resilience over the past eight months has been outstanding.”
He also noted that, as copper is a critical metal for the future and competition in the global copper smelting market is fierce, it is not a level playing field with various countries seeking to secure substantial market positions.
“We support the Australian and Queensland governments’ push to develop policies which enable critical metals processing to continue in Australia, backed by a mining sector that makes a significant contribution to the economy and supported by affordable and reliable energy,” he said.
“Glencore has demonstrated its commitment to sustaining copper processing operations and preserving jobs by absorbing material financial losses. It is our hope that conditions improve over the next three years to a point where government assistance is no longer necessary.”
Source: Glencore.com.au