Glencore are keeping costs down but there are no plans to increase its operation in the near future, a Mount Isa Mines community consultation session heard on Tuesday.
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Greg Ashe, COO of Zinc Assets Australia, said Lady Loretta mine would remain for now in care and maintenance it has been in since 2015 despite the high zinc price.
“We’ve seen a positive uptick in commodity prices which is a good thing but the volatility is still there, 18 months ago (zinc) was at a five year low, today we’re at a 10 year high,” Mr Ashe said.
“We would like to see a more clarity and certainty in stability in the market.”
Mr Ashe said all Glencore could do was to position themselves as best they could for when the time was right.
Power and transport remain major cost drivers and COO Copper Assets Australia Mike Westerman said they needed to secure reliable baseload energy and long-term gas contracts.
“We’ve been able to do that for power, long-term energy contracts, but gas is still a moving target,” Mr Westerman said. “We support the government’s intervention in that market.”
In transport Mr Westerman said they had moved everything they had on road since the start of the year back on to rail.
“PN (Pacific National) built all the right flat beds, so all of those are back on rail and there is an opportunity to move some additional product (onto rail),” he said.
On the smelter, Mr Westerman told the North West Star they would not be applying for the $15 million subsidy to rebrick it that the state government promised in late 2016.
“We don’t believe projects should be individually subsidised, we believe investment decisions should be made based on the prevailing economic conditions,” he said.
Earlier in the public session he said smelting was going to be an ongoing issue.
“Not only is it a large consumer of energy but global capacity for smelting and refining is at an all time high so the competition is quite high,” he said.
He said the Mount Isa copper grade would go down by 20% in the next four years and 2022-2023 was their best estimate of current end of life of the underground mine.
Internationally, Glencore have just released their 2017 half year results with good financial performance with a continued focus on cost savings and operational efficiencies and the company said they remained confident medium to longer term for their key commodities copper, zinc/lead and nickel.
Northern Australia is a core part of their copper and zinc business with over 4000 jobs in the region, a spend of $930m this year on goods and services and $1.7m spent on community projects.
Mr Ashe said George Fisher mine still has a good future.
Mr Westerman said the production of copper cathode went down from 141.4 KT in the first half of 2016 to 117.6 KT in the same period in 2017, down 17 percent.
The decrease was driven by lower mixed tonnes and copper grade at Mount Isa which was partially offset by higher tonnes and grade at Ernest Henry in Cloncurry.
Derek Barry
Editor of the North West Star Mount Isa since January 2016. Prior to that, an editor at several regional southern Queensland newspapers. Passionate about telling local stories. Comes with a strange accent to due an Irish accident of birth.
Editor of the North West Star Mount Isa since January 2016. Prior to that, an editor at several regional southern Queensland newspapers. Passionate about telling local stories. Comes with a strange accent to due an Irish accident of birth.
