Glencore has declared its Mount Isa copper smelter in Queensland, Australia, unsustainable and is seeking support from state and federal governments to continue operations, according to a report by Reuters.
The UK-Mount Isa smelting business and related mining operations in Queensland state are due to cease next month, necessitating the procurement of copper concentrate for processing.
The company is unable to sustain operations at the smelter as global smelting capacity currently exceeds demand, driving processing fees to record lows.
Glencore stated: “A combination of unprecedented smelting market conditions, high costs like energy, gas and labour, and a shortage of copper concentrates is currently making the Mount Isa copper smelter unviable.”
On Friday, several lawmakers including Australia's Industry and Science Minister, Tim Ayres, and Queensland Resources Minister Dale Last visited the plant.
Both state and federal governments are actively discussing potential solutions to sustain the smelter, which plays a significant role in the regional and state economies.
Ayres said: “The Australian Government is closely monitoring the situation at the Mount Isa copper smelter and we are committed to working with the Queensland Government on the best path forward.
“As a vital industrial site for the Mount Isa community and the broader region, any closure of the Mount Isa copper smelter would have a detrimental impact on Australia’s sovereign capability and other facilities downstream that rely on the smelter.”
Glencore has proposed a plan aimed at preserving the smelter and refinery.
Glencore’s Australian metals business chief operating officer Troy Wilson said: “We want to continue operating the smelter and refinery and look forward to hearing feedback from both federal and Queensland governments on a possible way forward.”
Additionally, Glencore has revealed plans to streamline its coal operations by merging its recently purchased Canadian mines into a unified division overseen from Australia.
This decision is intended to improve the company's asset management effectiveness and follows Glencore's purchase of steelmaking coal properties from Teck Resources for $6.9bn (SFr5.65bn).
