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Glencore is buying the interests of its partners at one of the largest thermal coal mines in the world, as pressure from banks and investors has renewed the industry’s latest deal.
Under the deal, the London-listed mining and commodity dealer has agreed to acquire 66.6 per cent of Cerrejón, which no longer exists, from Anglo American and BHP, for $ 294 million each. Glencer expects to recoup its investment two years after the completion of the purchase.
The agreement was marked last change of ownership in the thermal coal industry, and when the price of fossil fuels reached its highest level in a decade Strong demand from Asia and the lack of investment in the new offer.
Glencore also said on Monday that it aimed to reduce all of its emissions by 50 percent by 2035 to 2019 levels, compared to the previous 40 percent target, and a 15 percent reduction by 2026. Whole property of Cerrejon.
They come from big miners under increasing pressure investors and banks to divert coal mines and align businesses with the goals of the Paris climate agreement. Thermal coal is burned in power plants to generate electricity, a process that accounts for about 30% of the world’s carbon dioxide emissions.
Anglo American has dismantled South Africa’s active coal in a listed company in Johannesburg and London. The Cerrejon agreement will complete the exit from coal. It’s BHP examining offers For the Australian thermal coal business.
However, Ivan Glasenberg is Glencore’s longtime chief executive the disinvestment of coal was in vain, saying there were no environmental benefits for investors to pressure miners to sell or extract coal mines.
He argued that the company, the world’s largest exporter of thermal coal, was better able to walk through its mines and use it as a source of money, such as nickel, copper and raw material production. cobalt that will be needed as the world shifts to cleaner energy.
That’s why Glencor decided to buy the interests of Anglo and BHP when they announced their intention to disintegrate this year. According to Glencore, by the time the deal closes in the second half of next year, the money generated in the interim could reduce the purchase price by $ 230 million.
“Disposing of fossil fuel assets and turning them into someone else’s problem is not the solution and will not reduce absolute emissions,” Glasenberg said. “We are confident that we can manage the decline in the fossil fuel portfolio responsibly, in line with meeting the goals of the Paris Agreement, as it proves that the overall targets for reducing emissions are strengthened.”
The deal effectively replaces the tonnage lost by Glencore at Prodeco, another coal mine in Colombia, when it decided to produce the moth.
Glencore He committed in 2019 coal production to invest about 150m tons per year under pressure from large investors. Further expansion of the coal business was largely ruled out, although Glencore said it would buy the joint venture partners where it first had the right to waive its holdings.
The Cerrejon agreement will increase Glencore’s thermal coal production by around 125m tonnes this year, from earlier 110m orientations.
Glencor aims to meet its emissions reduction targets by depleting active coal over time and moving renewable energy and clean fuels in its mines.
The purchase will also come when Glasenberg is preparing to stop by the end of the month. It’s happening Gary Nagle got it, Former head of Glencore’s coal business.
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