The Australian and Queensland governments have signed heads of agreement with Glencore to provide a financial support package of up to A$600m to continue operations at the Mount Isa copper smelter and Townsville copper refinery.
The funding will be disbursed in three instalments of up to A$200m each, contingent upon the completion of a transformation study and other review milestones.
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The transformation study will assess the entire copper value chain at Mount Isa, focusing on enhancing long-term industrial capability.
Australia’s Industry and Science Minister, Tim Ayres, said: “This funding will protect Mount Isa’s workforce and regional Queensland industries, while reinforcing the need to deliver good, skilled jobs to deliver a Future Made in Australia.
“Copper is critical to building solar panels, wind turbines and energy storage systems. This investment strengthens our supply chains and supports Australia’s transition to net zero.”
Glencore stated that the Mount Isa copper smelter is the only facility in Australia that processes products from both local and regional sources.
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By GlobalDataThis agreement aims to provide stability for workers, the local community and industries throughout regional Queensland that depend on this operation, according to a joint statement issued by the federal and state governments.
Over the next six years, Glencore plans to invest A$2.5bn in the Mount Isa area, including further development of the George Fisher Mine and the potential expansion of the Black Star Open Cut project.
Glencore Metals Australia interim chief operating officer Troy Wilson said: “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 the government.
“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.”
In June this year, Reuters reported that Glencore was seeking financial backing from the Queensland and federal governments to keep Mount Isa’s copper smelter in operation.
The company was unable to sustain operations at the smelter as global smelting capacity then exceeded demand, driving processing fees to record lows.
Last month, the Australian Government approved an extension for Glencore’s Ulan Coal Mine.
