Coal operation at the Mt Owen mine in New South Wales. Image: Glencore
Glencore chief executive Ivan Glasenberg, who is rumoured to be leaving the company soon, is not stepping down from his role without driving the company’s transition to a low-carbon economy.
Glencore aims to reduce its scope three emissions by around 30 per cent by 2035, which will be partly achieved by depleting its coal resource base over time.
The company expects the depletion of its coal resource base in Colombia, and to a lesser extent, South Africa and Australia.
“Our Australian operations are expected to maintain a longer and flatter production profile and will continue to produce high quality coal, which will be required to meet expected levels of global steel production and energy demand in Asia,” Glencore stated.
The company is also on track to reduce its scope one and two emissions intensity by around 10 per cent this year, double of its first reduction target of 5 per cent.
Glencore suffered through trade uncertainty during 2019, despite most assets performing as anticipated.
The company experienced headwinds in the cobalt portfolio during the first half of last year, with average price down 57 per cent.
Other commodities other than nickel and gold saw lower price performances last year, with average copper price down 8 per cent, zinc 13 per cent, thermal coal 27 per cent and ferrochrome 14 per cent.
Glencore’s copper, zinc and nickel portfolios performed in line with global inventories, which were falling to multi-year lows, according to the company.
Conditions improved toward year end as the market rebalanced, while coal saw continued growth in Asian thermal demand, Glencore added.
This has led to a decline in Glencore’s earnings before interest, tax, depreciation and amortisation (EBITDA) by 26 per cent to $11.6 billion last year.
“In relation to our ramp up/development assets, performance is steadily improving, in particular at our flagship Katanga operation, which met its second half year production targets for both copper and cobalt,” Glasenberg said.
“Looking ahead, in the short-term, we are closely watching coronavirus developments and potential scenario impacts on global growth and markets.
“Our priorities for 2020 (include) delivering a step change in safety performance, realising the potential of our ramp up assets, seizing further operational efficiencies, strengthening our balance sheet and managing the transition to Glencore’s next generation of leadership.”
