JOHANNESBURG (miningweekly.com) – Diversified mining and marketing company Glencore expects to be able to announce the decision of the board regarding the potential demerger of its coal and carbon steel materials business next week.

The London- and Johannesburg-listed company is currently in the process of consulting with shareholders to assess their views on a potential coal and carbon steel materials business demerger.

An announcement on this is expected alongside the presentation of interim results on August 7.

Last month, Glencore acquired the remaining 77% of Canadian mining company Teck Resources’ shareholding in Elk Valley Resources (EVR) steelmaking coal business.

"Post the acquisition of EVR, we are now in the process of consulting with shareholders to assess their views regarding the potential demerger of our coal and carbon steel materials business.

“We expect to be able to announce the outcome of such engagement and the decision of the Board regarding the potential demerger alongside our interim results next week," Glencore CEO Gary Nagle stated in its half-year production release to Mining Weekly.

“Across the portfolio, our full-year 2024 production guidance has been maintained and we have added additional steelmaking coal volumes in H2 2024, following successful closing of the EVR acquisition.

“Our forward-looking production guidance has been adjusted to separate steelmaking and energy coal.

“As anticipated, 2024 is expected to be a year of two halves, whereby the tracking of our year-to-date production versus guidance is expected to be caught up during the second half of the year,” added Nagle.

Coal production of 50.6-million tonnes was 7% lower, on mainly the progressive effect of scheduled mine closures, the temporary impact of longwall moves in Australia in 2024 and export rail constraints in South Africa.

South Africa’s energy coal production of 7.9-million tonnes was 0.6-million tonnes (7%) lower than in the corresponding first-half period of last year, mainly reflecting various measures implemented to progressively reduce coal production owing to export rail capacity constraints.

“As and when additional rail capacity is restored, the potential exists to increase production rates,” Glencore stated.

Second-half energy coal production uplift is expected to arise mainly from longwall changes, improved equipment availability and reduced strip ratios in Australia.

South Africa’s ferrochrome production of 599 000 t in the first six months of this year was 16% lower than in the corresponding period of 2023 as the Rustenburg smelter remained idled in response to weak market conditions and pending an improved price/cost environment.

Higher second-half copper production is expected from African Copper in the Democratic Republic of Congo, and Antapaccay in Peru, and higher second-half zinc production is seen to be on the way from Kazzinc in Kazakhstan, where Zhairem is continuing to ramp up.

There will also likely be more nickel from Murrin Murrin in Australia.

Full-year steelmaking coal production guidance has been updated to 19-million to 21-million tonnes through the inclusion of 12-million tonnes of expected second-half EVR volumes.

In the first half, own sourced copper production of 462 600 t was 2% down on last year and the 15 900 t of cobalt 27% lower than the first half of 2023.

Own-sourced overall zinc production of 417 200 t was 4% down and nickel production a 5% lower 44 200 t owing to Koniambo’s care-and-maintenance transition in New Caledonia.

Glencore expects to report a reduction in net first-half working capital and net debt.