Glencore to Announce Whether it Will Spin Off Coal Business

Researched by Industrial Info Resources (Sugar Land, Texas)--Anglo-Swiss mining major Glencore plc (Baar, Switzerland) said Tuesday it will announce next week whether it will spin off its coal business.

Glencore said it would announce the decision at its August 7 interim financial results presentation.

Glencore Chief Executive Officer Gary Nagle said in a press release that "we are now in the process of consulting with shareholders to assess their views regarding the potential demerger of our coal and carbon steel materials business. We expect to be able to announce the outcome of such engagement and the decision of the board regarding the potential demerger alongside our interim results next week."

On July 11, Glencore completed the US$7.3 billion acquisition of the majority of Teck Resources Limited's (NYSE:TECK) (Vancouver, British Columbia) Elk Valley Resources (EVR) four steelmaking coal mines in British Columbia.

When the EVR deal was announced in November 2023, Glencore said it intended to demerge its combined coal and carbon steel materials business into a standalone company, in line with Glencore's target to achieve net-zero carbon emissions by 2050.

However, Reuters has quoted analysts as saying a demerger was unlikely. Reuters in March reported that a growing group of Glencore investors wanted the company to continue to mine coal.

Glencore announced its first-half 2024 production results on Tuesday. The company reported that production of eight metals and minerals was lower in the first half of this year when compared with first-half 2023.

The company said its own-sourced copper production was 462,600 metric tons, which was 2% below first-half 2023 production. Its own-sourced cobalt production of 15,900 metric tons was 27% lower than in first-half 2023. Lower production also was reported for zinc, nickel, ferrochrome, energy coal and steelmaking coal.

Glencore's Nagle said: "As anticipated, 2024 is expected to be a year of two halves, whereby the tracking of our year-to-date production versus guidance is expected to be caught up during the second half of the year."

Industrial Info is tracking 149 active Glencore capital projects worth more than US$20 billion, including $2.69 billion worth that are now under construction. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for a list of under-construction project reports.

Glencore is developing the grassroot Onaping underground nickel-copper mine in Ontario. Construction began in 2018 and is planned for completion by the end of 2024. When completed, the mine is planned to produce 9,000 tons per year of copper concentrate, 20,000 tons per year of nickel concentrate and 1.2 million tons per year of nickel ore. Subscribers can click here for the project report and click here for the related plant profile.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 Trillion (USD).