Glencore reports lower production, builds solar plant in South Africa

1st February 2024 By: Marleny Arnoldi - Deputy Editor Online

Glencore reports lower production, builds solar plant in South Africa

Glencore CEO Gary Nagle

Diversified miner Glencore has reported lower volumes across its key commodities for the 2023 financial year, but notes that these were all nonetheless still within the guided ranges.

The company’s own-mined production for the year totalled 1.01-million tonnes of copper, reflecting a 5% year-on-year decline; 41 300 t of cobalt, marking a 6% year-on-year decrease; 918 500 t of zinc, which was 2% lower year-on-year; and 182 700 t of lead, reflecting a 5% year-on-year decrease.

Nickel production of 97 600 t was also 9% lower year-on-year; silver output of 20-million ounces 16% lower year-on-year; and ferrochrome production of 1.1-million tonnes 11% lower.

The company recorded a 13% increase in gold production from 661 000 oz in the 2022 financial year to 747 000 oz in the reporting year, as well as a 3% increase in coal output from 110-million tonnes in the prior year to 113-million tonnes in the reporting year.

Glencore CEO Gary Nagle attributes the lower copper and zinc volumes, including managed production volumes, to the disposals of the Cobar copper mine, in Australia, and various South American zinc operations in the year under review.

He adds that cobalt production was lower owing to feed plan adjustments at the Mutanda operation, in the Democratic Republic of Congo, in the context of an oversupplied market, while nickel volumes were impacted on by higher third-party production compared with own sourced production, as well as the planned shutdown of the Murrin Murrin operation, in Australia, for routine maintenance.

The company also had planned additional smelter downtime in the ferrochrome segment, during the three-month high-electricity demand winter season in South Africa when power prices are elevated.

As a result of the lower 2023 production, the group has adjusted its production guidance for this year to between 950 000 t and 1.01-million tonnes of copper, between 35 000 t and 40 000 t of cobalt, between 900 000 t and 950 000 t of zinc, between 80 000 t and 90 000 t of nickel, between 1.1-million and 1.2-million tonnes of ferrochrome and between 105-million and 115-million tonnes of coal.

Notably, the guidance does not take into account contributors from the Elk Valley Resources steelmaking coal assets, in Canada, which Glencore is in the process of acquiring a 77% interest in.

Moreover, Glencore expects to report earnings before interest and taxes of about $3.5-billion for the 2023 financial year.

Glencore will publish its full results for the year on February 21.

Meanwhile, Glencore has started construction on a 25 MW solar photovoltaic power plant at its Rhovan-managed ferroalloys mining and processing facility near Brits, in South Africa’s North West province.

Once completed, the plant will produce about 30% of the operations’ yearly energy demand, which should save 48 000 t/y in carbon emissions at the site.

Glencore Ferroalloys CEO Japie Fullard explains that, not only does the mine produce a range of vanadium products that can be used in applications to support a low-carbon economy, but by installing a solar plant that will supply renewable energy to the operation, Glencore is reducing the mine’s overall emissions footprint. 

The company plans to work alongside the Bakwena Ba-Magopa community in developing the plant, including by involving local small- and medium-sized enterprises in the project.

Commissioning of the solar plant is planned for later this year.