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Cobalt’s meteoric rise at risk from Congo’s Katanga – by Henry Sanderson (Financial Times – March 14, 2017)

https://www.ft.com/

Reopening of mothballed mine and uncertainty over China demand weighs on metal’s price

Hedge funds and speculators betting that the electric vehicle revolution will drive prices of battery material cobalt into the stratosphere could be wrongfooted.

Next year Glencore, the world’s biggest producer of the bluish metal, is due to bring the Katanga mine in the Democratic Republic of Congo back on line after a $430m overhaul of its processing system. The operation has the potential to add as much 22,000 tonnes of cobalt to a market with annual output of around 100,000 tonnes.

That could bring the price of cobalt, which has surged 135 per cent this year, back to earth with a bump. Goldman Sachs analysts say the resumption of production at Katanga “will significantly change the supply dynamics” for cobalt and ensure the market is well supplied up to the end of 2019.

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Why Glencore bought Israeli tycoon out of Congo mines – by Tom Burgis (Financial Times – March 13, 2017)

https://www.ft.com/

LONDON – After years of doing business together in one of the world’s poorest countries, Glencore has dissociated itself from Dan Gertler, an Israeli mining tycoon implicated in the payment of bribes to the ruler of the Democratic Republic of Congo.

Glencore’s announcement last month that it would pay $534m to Mr Gertler to buy him out from their shared prize assets in the DRC — two giant copper mines — is designed to insulate the London-listed mining cum trading behemoth from the fallout of a widening corruption investigation involving the Israeli businessman, say people who have followed the saga.

The decision by Ivan Glasenberg, Glencore’s chief executive, highlights the risks of doing business in the resource-rich, war-torn central African country, where Mr Gertler wields influence by virtue of his close friendship with Joseph Kabila, the DRC president.

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[Cobalt] Glencore Is on to a Winner With This Obscure Metal – by Mark Burton (Bloomberg News – March 8, 2017)

https://www.bloomberg.com/

Cobalt is having a moment in the spotlight. Historically a minor byproduct of copper and nickel mining, the metal is a key ingredient for lithium-ion batteries and now a growing money maker for Glencore Plc.

In the past eight months, prices more than doubled on speculation that supply won’t keep up with demand for batteries in electric cars. Glencore, the largest cobalt producer, plans to about double output by 2018, and only coal, copper and zinc offer more of an earnings boost when prices rise.

Cobalt, which has been in oversupply for years, was often treated as an afterthought at the copper and nickel mines where it’s found. Now, demand for the once obscure metal that’s mined largely in the Democratic Republic of Congo is soaring as it graduates from mobiles to larger batteries in electric vehicles and homes.

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Glencore Paid Gertler’s Firm $100 Million Congo Royalties – by Thomas Wilson (Bloomberg News – March 2, 2017)

https://www.bloomberg.com/

Glencore Plc paid more than $100 million previously owed to the Democratic Republic of Congo’s state mining business to a company controlled by billionaire investor Dan Gertler, according to advocacy group Global Witness.

It’s the first time the value of the payments made to Gertler have been made public, after London-based Global Witness reported in November that government-owned Gecamines signed over its royalties from the Kamoto copper project in southeastern Congo to Gertler in January 2015. Gertler’s privately held Fleurette Group said the payments were made on instruction from Gecamines to help repay a loan.

Glencore’s Katanga Mining Ltd. made the royalty and contractual bonus payments over the past four years to Africa Horizons Investments Ltd., a unit of Fleurette, Global Witness said in a report published Friday. Glencore confirmed the payments to Gertler’s company in a letter to the advocacy group. In previous filings, Katanga Mining either said the payments went to Gecamines or didn’t specify the recipients.

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Vale, Glencore back in the black – by Staff (Sudbury Star – February 24, 2017)

http://www.thesudburystar.com/

Two of Sudbury’s most important employers reported healthy profits on Thursday. Brazilian miner Vale SA said it made a net profit of US $3.98 billion in 2016, while Glencore made US $1.99 billion. The results are a dramatic turnaround for both companies, which have struggled with low commodity prices and high debt in recent years.

Vale reported on Thursday net profit of $525 million for the fourth quarter, falling short of analyst expectations but reversing a heavy loss in the period a year earlier thanks to record output and higher iron ore prices.

A Reuters poll of analysts had forecast net profit of $1.8 billion in the quarter, but the world’s largest producer of iron ore fell short on account of impairments totaling $2.9 billion, principally on fertilizer and nickel assets. In the same period of 2015, Vale reported a net loss of $8.6 billion.

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Ivan Glasenberg keen to tell the world he is back on top – by Neil Hume and David Sheppard (Financial Times – February 24, 2017)

https://www.ft.com/

The morning after announcing a return to profit that capped a dramatic turnround for Glencore, you could have forgiven Ivan Glasenberg, the mining and trading company’s billionaire chief executive, for enjoying a lie in.

Not so. By 5.45am on Friday, the 60-year-old was in the lobby of his hotel in London’s Park Lane, limbering up for a run with a select group of analysts and other associates who were much younger than him.

After a brisk 7km around Hyde Park — clocking 4m 48s/km — he dashed off to a breakfast meeting with investors. By the evening Ivan, as he is universally known in the commodities industry, was preparing to head to Florida to attend a mining conference.

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Analysts acclaim Glencore’s performance as good fundamentals return – by Martin Creamer (MiningWeekly.com – February 23, 2017)

http://www.miningweekly.com/

JOHANNESBURG (miningweekly.com) – Commodity market fundamentals are improving against a backdrop of better than expected demand and limited, if any, inventory build through the trough of the cycle, diversified mining and marketing company Glencore said on Thursday.

This comes against the background of the London-, Hong Kong- and Johannesburg-listed company reporting 18% higher earnings before interest, taxes, depreciation and amortisation (Ebitda) at $10.3-billion, 41% lower capital expenditure to $3.5-billion and operational unit cash cost performance in zinc at a negative –5c/lb.

The company, headed by CEO Ivan Glasenberg, also succeeded in managing down its full-year unit copper cost to 87c/lb, nickel to 265c/lb and thermal coal to $39/t with an $18/t margin.

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Mining giants ride copper’s price wave – by Scott Patterson (Dow Jones/The Australian – February 20, 2017)

http://www.theaustralian.com.au/

Copper bulls are looking smart — for now. Some of the world’s biggest mining companies, which have giant copper portfolios, are now poised to reap the rewards, with Anglo American, BHP Billiton and Glencore set to report full- or half-year earnings this week.

The industrial metal has surged more than 30 per cent in the past year, providing rocket fuel for companies that were staring into the abyss a year ago. Shares in Anglo and Glencore have more than tripled in the past 12 months. BHP, which has faced headwinds from a fatal tailings-dam disaster at one of its mining operations in Brazil, is up 62 per cent.

Rio Tinto, which is focusing more on its copper business, offered a preview of how miners’ fortunes have flipped to the upside when it reported earnings earlier this month. The Anglo-Australian mining giant said it returned to a profit in 2016 with $US4.62 billion in earnings, increased its dividend and announced a $US500 million share buyback.

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Glencore Buys Out Billionaire With $1 Billion Congo Mining Deal – by Franz Wild, Tom Wilson and Jesse Riseborough (Bloomberg News – February 14, 2017)

http://www.bloombergquint.com/

(Bloomberg) — Glencore Plc agreed to a $960 million deal that will boost ownership of two giant Congolese cobalt and copper mines, and sever its ties with controversial Israeli billionaire Dan Gertler.

For Glencore, the deal achieves two things: greater control of key assets at a time of booming copper and cobalt prices and a parting of ways from Gertler after his business in the Democratic Republic of Congo and relationship with President Joseph Kabila attracted scrutiny from the U.S. Department of Justice.

Glencore will pay Fleurette Group, a company owned by Gertler’s family trust, $534 million cash after all debts are paid, the company said in a statement on Monday. The assets include a 31 percent stake in Mutanda Mining, the world’s biggest cobalt mine, and a 10.3 percent holding in Katanga Mining Ltd., which operates a nearby copper and cobalt mine.

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Contract for Mine Millers ‘a tough one’ – by Jim Moodie (Sudbury Star – February 1, 2017)

http://www.thesudburystar.com/

Union representatives were confident a tentative deal with Glencore’s Sudbury Integrated Nickel Operations would be approved Tuesday as production and maintenance workers packed a conference room at the Radisson Hotel to place their votes.

And indeed it was, by a 79 per cent margain. The four-year deal, recommended by the bargaining committee for Mine Mill Local 598 Unifor, will see a two-percent wage increase over the length of the contract and a couple of tweaks to dental and drug plans, but no major concessions.

“This one was a tough one, I have to say,” said chief negotiator Richard Paquin, a veteran of four previous rounds of bargaining. “With the price of nickel hovering around $4.20 or $4.30 (per pound), versus what it was four years ago, around $8, it makes bargaining a lot different.”

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Glencore Considering Bid for Impala’s Chrome Waste Operations – by Loni Prinsloo and Kevin Crowley (Bloomberg News – January 31, 2017)

https://www.bloomberg.com/

Glencore Plc, the mining and trading firm run by billionaire Ivan Glasenberg, is considering bidding for Impala Platinum Holdings Ltd.’s 65 percent stake in a chrome waste-retreatment operation in South Africa, two people familiar with the matter said.

Glencore already has an agreement to buy metal from Chrome Traders Processing (Pty) Ltd., the closely held company that owns 30 percent of the business controlled by Impala.

Glencore, which has chrome assets nearby, is bullish on prices and keen to grow its presence in the industry that supplies stainless steelmakers with the ingredient that prevents corrosion, said one of the people, who asked not to be identified because the information is private.

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Sudbury INO, Mine Mill have contract – by Staff (Sudbury Star – January 31, 2017)

http://www.thesudburystar.com/

Glencore and its production and maintenance employees in Sudbury have reached a tentative collective agreement. Workers will vote on the deal Tuesday. The negotiations team for UNIFOR Local 598, Sudbury Mine, Mill and Smelter Workers Union, is unanimously recommending ratification of the tentative agreement.

The current contract expires Jan. 31 at midnight. Peter Xavier, vice president of Sudbury Integrated Nickel Operations (Sudbury INO), a Glencore company, praised the agreement in a release.

“We are very pleased that the parties have reached a tentative agreement that is competitive, fair and represents a balance of interests in securing a longer term future for Sudbury INO, particularly at this time of prolonged market uncertainty,” Xavier said.

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How Russia sold its oil jewel Rosneft without saying whether Glencore bought it (Australian Financial Review/Reuters – January 26, 2017)

http://www.afr.com/

More than a month after Russia announced one of its biggest privatisations since the 1990s, selling a 19.5 per cent stake in its giant oil company Rosneft, it still isn’t possible to determine from public records the full identities of those who bought it.

The stake was sold for €10.2 billion to a Singapore investment vehicle that Rosneft said was a 50/50 joint venture between Qatar and the Swiss oil trading firm Glencore.

Unveiling the deal at a televised meeting with Rosneft’s boss Igor Sechin on December 7, President Vladimir Putin called it a sign of international faith in Russia, despite US and EU financial sanctions on Russian firms including Rosneft.

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Automated vent system saving millions for Kidd Mine – by Sarah Moore (Timmins Daily Press – January 21, 2017)

http://www.timminspress.com/

TIMMINS – Glencore’s Kidd Operations was recognized by the province for its energy conservation efforts on Friday morning at a presentation at the Timmins Museum.

Representatives from the mine joined Timmins Mayor Steve Black, Terry Young, vice-president of conservation and corporate relations with the Independent Electricity System Operator (IESO) and Ontario Energy Minister Glenn Thibeault that morning to showcase Kidd’s new ventilation-on-demand system as an example of how utilizing government funding programs will reduce energy consumption and cut energy costs.

Kidd tapped into the government’s Industrial Accelerator Program in order to offset $5.6 million of the total $9 million required to transition to the fully automated underground ventilation system it now has today.

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Glencore back in the good books of Wall Street – by Eric Reguly (Globe and Mail – December 31, 2016)

http://www.theglobeandmail.com/

In the late summer of 2015, Glencore was evidently sized up by the hedge funds as a potential Lehman Bros.

Debt at the world’s biggest commodities trader, and one of the biggest miners, was way too high, at almost $30-billion (U.S.). Prices for copper and other metals were sinking. The situation became critical when South African investment firm Investec on Sept. 28 of last year said Glencore’s equity value “could evaporate” if commodity prices did not rise and CEO Ivan Glasenberg did not implement a “substantial restructuring.”

Much to the delight of the hedge funds, which had been shorting the shares with alacrity, Glencore fell 29 per cent the next day, hitting an all-time low of 67 pence on the London Stock Exchange – 87 per cent below their 2011 initial public offering price of 530 pence. They were even more delighted by Mr. Glasenberg’s curious inaction. Typically hard charging, he seemed to be resisting a deleveraging exercise that could restore confidence in the company.

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