TIDMGLEN
RNS Number : 7648N
Glencore PLC
03 February 2021
NEWS RELEASE
Baar, 3 February 2021
Full Year 2020 Production Report
Glencore Chief Executive Officer, Ivan Glasenberg:
"Our mining assets performed well in difficult circumstances
during 2020. Various precautionary operating changes made in Q2
continued into the second half, with sustainable and safe working
practices embedded for the pandemic era. Production picked up
accordingly, with year-over-year increases in zinc, gold and silver
production.
"Excluding Mutanda (currently on care and maintenance), 2020
copper production was in line with 2019, while cobalt production
was 6,200 tonnes higher, reflecting Katanga's continued successful
ramp-up to design capacity levels. Required Covid-19 related
mandatory suspensions and international mobility restrictions
significantly impacted 2020 production of ferrochrome in South
Africa, oil in Chad and nickel at Koniambo. Furthermore, various
proactive market-related supply reductions were initiated in H2
2020, primarily with respect to coal production from Australia.
"As noted at our recent 2020 Investor Update, we continue to
progress portfolio optimisation, and, in this regard, recently
agreed terms for the sale of Mopani to an existing minority
shareholder. Work continues to advance options around other
non-core assets within the Group."
Production from own sources - Total(1)
Change
2020 2019 %
--------------------------------- ------------ ----------- ----------- ------------
Copper kt 1,258.1 1,371.2 (8)
Cobalt kt 27.4 46.3 (41)
Zinc kt 1,170.4 1,077.5 9
Lead kt 259.4 280.0 (7)
Nickel kt 110.2 120.6 (9)
Gold koz 916 886 3
Silver koz 32,766 32,018 2
Ferrochrome kt 1,029 1,438 (28)
Coal - coking mt 7.6 9.2 (17)
Coal - semi-soft mt 4.6 6.4 (28)
Coal - thermal mt 94.0 123.9 (24)
--------------------------------- ------------ ----------- ----------- ------------
Coal mt 106.2 139.5 (24)
Oil (entitlement interest basis) kbbl 3,944 5,518 (29)
1 Controlled industrial assets and joint ventures only.
Production is on a 100% basis, except as stated.
Production guidance
-- FY 2021 guidance as per our investor presentation in December 2020 is still current.
-- Changes versus 2020 reflect:
- Katanga cobalt production continuing to ramp up to steady-state capacity
- Commissioning of Zhairem zinc/lead project in Kazakhstan
- Chrome smelters running throughout the year following a Covid-disrupted 2020
- Cautious coal supply increases in Australia, following market-driven reductions in H2 2020.
Actual Actual Actual Guidance
FY FY FY FY
2018 2019 2020 2021
------------ --------- -------- -------- -------- --------
1,220
Copper kt 1,454 1,371 1,258 +/- 30 (1)
------------ ----------- -------- -------- -------- --------
35 +/-
Cobalt kt 42.2 46.3 27.4 2
------------ ----------- -------- -------- -------- --------
1,250
Zinc kt 1,068 1,078 1,170 +/- 30 (2)
------------ ----------- -------- -------- -------- --------
117 +/-
Nickel kt 124 121 110 5
------------ ----------- -------- -------- -------- --------
1,400
Ferrochrome kt 1,580 1,438 1,029 +/- 30
------------ ----------- -------- -------- -------- --------
113 +/-
Coal mt 129 140 106 4
1 Excludes Mopani.
2 Excludes Volcan.
Realised prices
Realised
US$ million c/lb $/t
------------ ----------- -----------
Copper 285 6,283
Zinc 102 2,242
Nickel 619 13,647
The average Newcastle coal (NEWC) settlement price for the
period was $60.45/t. After applying a portfolio mix adjustment
(component of our regular coal cash flow modelling guidance) of
$3.60/t to reflect, amongst other factors, movements in pricing of
non-NEWC quality
coals, an average price of c.$56.8/t was realised across all
coal sales volumes.
Production highlights
-- Own sourced copper production of 1,258,100 tonnes was 113,100
tonnes (8%) lower than 2019, mainly reflecting Mutanda being on
care and maintenance in 2020 (partly offset by Katanga's successful
ramp-up), with Covid-19 related suspensions being a much smaller
factor.
-- Own sourced cobalt production of 27,400 tonnes was 18,900
tonnes (41%) lower than 2019, mainly reflecting Mutanda on care and
maintenance. On a standalone basis, Katanga's cobalt production was
up 6,800 tonnes (40%).
-- Own sourced zinc production of 1,170,400 tonnes was 92,900
tonnes (9%) higher than 2019, mainly reflecting: (i) higher zinc
content from Antamina (40,000 tonnes); (ii) improved output from
the Mount Isa operations (27,800 tonnes); and (iii) the net
positive effect of 18,700 tonnes from Other South America, owing to
restarting the short-life Iscaycruz mine in Peru, offset by
Covid-related suspensions and shutdowns.
-- Own sourced nickel production of 110,200 tonnes was 10,400
tonnes (9%) lower than 2019, reflecting Koniambo operating as a
single-line operation for the majority of 2020, with Covid-related
mobility restrictions affecting its maintenance schedule. The
expected decline in grades at the existing Sudbury mines (INO) also
contributed.
-- Attributable ferrochrome production of 1,029,000 tonnes was
409,000 tonnes (28%) lower than 2019, reflecting the South African
lockdown and resulting suspension of smelting operations in Q2,
with a phased restart thereafter. Lydenburg smelter has been placed
on extended care and maintenance. The remaining four smelters were
fully operational from Q4, resulting in materially higher quarter
on quarter production.
-- Coal production of 106.2 million tonnes was 33.3 million
tonnes (24%) lower than in 2019, reflecting the impacts of the
pandemic via stopped or reduced work in Colombia and South Africa,
extended care and maintenance at Prodeco, plus market-related
supply reductions in Australia in H2 2020.
-- Entitlement interest oil production of 3.9 million barrels
was 1.6 million barrels (29%) lower than 2019. Operated fields in
Chad were placed on care and maintenance in March/April 2020 and
are yet to be restarted, given continued pandemic-related
challenges in international mobility (2.2 million barrels
decrease). The balance reflects year over year production increases
in Equatorial Guinea and Cameroon since new wells were drilled.
Other matters
-- In January 2021, Glencore agreed terms for the sale of its
interest in Mopani to ZCCM, with completion expected in H1
2021.
-- Glencore also published its 2020 Resources and Reserves report today.
To view the full report please click:
http://www.glencore.com/dam/jcr:9a549d01-c619-4e0d-b043-403a417bd79b/GLEN_2020-Q4_ProductionReport.pdf
For further information please contact:
Investors
Martin Fewings t: +41 41 709 2880 m: +41 79 737 5642 martin.fewings@glencore.com
Media
Charles Watenphul t: +41 41 709 24 62 m: +41 79 904 33 20 charles.watenphul@glencore.com
www.glencore.com
Glencore LEI: 2138002658CPO9NBH955
Notes for Editors
Glencore is one of the world's largest global diversified
natural resource companies and a major producer and marketer of
more than 60 responsibly-sourced commodities that advance everyday
life. The Group's operations comprise around 150 mining and
metallurgical sites and oil production assets.
With a strong footprint in over 35 countries in both established
and emerging regions for natural resources, Glencore's industrial
activities are supported by a global network of more than 30
marketing offices. Glencore's customers are industrial consumers,
such as those in the automotive, steel, power generation, battery
manufacturing and oil sectors. We also provide financing, logistics
and other services to producers and consumers of commodities.
Glencore's companies employ around 145,000 people, including
contractors.
Glencore is proud to be a member of the Voluntary Principles on
Security and Human Rights and the International Council on Mining
and Metals. We are an active participant in the Extractive
Industries Transparency Initiative. Our ambition is to be a net
zero total emissions company by 2050.
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subsidiaries in general. These collective expressions are used for
ease of reference only and do not imply any other relationship
between the companies. Likewise, the words "we", "us" and "our" are
also used to refer collectively to members of the Group or to those
who work for them. These expressions are also used where no useful
purpose is served by identifying the particular company or
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The companies in which Glencore plc directly and indirectly has
an interest are separate and distinct legal entities. In this
document, "Glencore", "Glencore group" and "Group" are used for
convenience only where references are made to Glencore plc and its
subsidiaries in general. These collective expressions are used for
ease of reference only and do not imply any other relationship
between the companies. Likewise, the words "we", "us" and "our" are
also used to refer collectively to members of the Group or to those
who work for them. These expressions are also used where no useful
purpose is served by identifying the particular company or
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