Glencore, the largest natural resources company in the world, said yesterday it planned to close 12 coal mines by 2035.
In its annual results released on Tuesday, the Swiss commodities trader said with 12 coal mine closures in the next 12 years, it was on track to reduce its Scope 1+2+3 CO2e emissions by at least 15% by 2026 and by 50% by 2035.
Glencore CEO Gary Nagle said: "It's critical in today's world, as the world continues to decarbonise. We believe it's our responsibility to help promote that (energy) transition and ensure that those areas that require us to use fossil fuels do so in a responsible manner.“
Glencore said its coal business was expected to generate about $16.7 billion (R290bn) in earnings before interest, tax, depreciation and amortisation (Ebitda) next year, even though thermal coal prices had eased recently.
Its coal production was expected to be flat between 2022 and 2025, with the guidance of about 110 million tonnes a year, down from Glencore’s previous estimation.
It expected to generate group earnings before interest, tax, depreciation, and amortisation (Ebitda), of $28.7bn in its 2023 financial year, and free cash flow would total $14.6bn.
Glencore said there would be a modest decline in copper production from other Glencore departments as it forecast a global structural shortage of copper in the coming years.
"Over the next eight years, global copper demand will outstrip supply by 50 million tonnes each year," Nagle said.
Nagle said to counter the demand, Glencore could develop a mine in El Pachon in Argentina, which could lead the company to increase its annual copper production by more than 60% from current levels.
Glencore said the costs for zinc and nickel production were expected to increase slightly next year, mostly due to higher energy costs.
Costs for coal and copper production were expected to decline slightly.
The group also said it could spend up to $6bn on mergers and acquisitions (M&A), which would be strategic for the company in terms of infrastructure and where they were situated.
"We can't comment too much on M&A opportunities. These are real opportunities that, if the opportunity arises, we would execute on," Nagle said.
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