Glencore might mothball DRC mine

Glencore is reportedly set to close its Mutanda copper-cobalt mine in the Democratic Republic of the Congo because it’s “no longer economically viable”
Glencore might mothball DRC mine Glencore might mothball DRC mine Glencore might mothball DRC mine Glencore might mothball DRC mine Glencore might mothball DRC mine

Glencore’s Mutanda copper-cobalt operation in the DRC

Staff reporter

The Financial Times cited the comment from a letter to employees of the mine.

Glencore has faced a series of issues in the DRC, from a new mining code to legal disputes and a growing number of illegal miners.

"Unfortunately due to the significant decrease in the cobalt price, increased inflation across some of our key input costs (mainly sulphuric acid) and the additional taxes imposed by the mining code, the mine is no longer economically viable over the long term," the newspaper quoted the letter stating.

Meanwhile Glencore-controlled Katanga Mining, which also produces copper and cobalt in the DRC, is currently subject to "a full and comprehensive business review", targeting efficiency, significant cost reductions and improving the company's prospects.

Katanga yesterday reduced its 2019 production guidance, from 285,000t of copper and 26,000t of cobalt, to 235,000t and 14,400t respectively.

However, it said initial indications from the business review suggested there might be scope for improvements at its majority-owned Kamoto Copper Company in the order of US$200-US$250 million per annum.

Kamoto had to suspend its cobalt sales in November after "unacceptable" levels of uranium were identified, with limited exports resuming in April. 

Meanwhile, Mutanda would stop production at the end of this year and be put on care and maintenance, a person familiar with the matter told Bloomberg.