Glencore announces funding decision on Koniambo Nickel

Noumea, New Caledonia
27 September 2023

Glencore has been working for years to identify a path toward a cost effective, reliable Koniambo Nickel SAS (KNS) business that can meet production and financial targets. While significant progress has been made in productivity performance and reliability, KNS continues to struggle financially and incur significant losses largely due to factors outside of its control relating to cost structures and market conditions. A recent report from the French Inspector General of Finance (IGF) into the nickel industry in New Caledonia acknowledged the significant challenges experienced by the industry, including KNS, as well as the need for far reaching changes to address these challenges and make the production of nickel on island viable.

Glencore has informed the Board of KNS that it will only provide funding for the operations of KNS until 29 February 2024. During this period, Glencore will work with KNS and relevant stakeholders to explore solutions for KNS' ongoing losses, including looking for alternative sources of funding for KNS.

At this time, we anticipate activities on site will continue as normal. Glencore will continue to provide financial support during this period, according to the budget, and remains committed to ensuring that KNS operates safely, maximising production and reducing costs. We will also continue to support KNS to explore alternative processing routes, lock down reverse polarity improvements, and study any other initiatives to help increase the value of the operation.

Beyond Glencore's significant funding of KNS – amounting to US$3.9 billion dollars since the acquisition of Xstrata, and a total of US$9.0 billion since project inception – Glencore has supported KNS in building capacity in the local workforce and developing a contractor ecosystem; embedded internationally recognised operating and safety standards; brought wider socio-economic benefits and contributed to the community; and investigated paths toward an energy transition.

Glencore will continue to work with KNS, our shareholder partner and the French Government over the coming months to determine whether any of the solutions identified in the IGF report can be implemented and whether there are other funding options for KNS.

Further updates will be issued as appropriate.

For further information please contact:

Investors

Martin Fewings    
t: +41 41 709 2880    
m: +41 79 737 5642    
martin.fewings@glencore.com

Media            

Charles Watenphul    
t: +41 41 709 2462    
m: +41 79 904 3320    
charles.watenphul@glencore.com

Glencore LEI: 2138002658CPO9NBH955
 

Notes for Editors

Glencore is one of the world’s largest global diversified natural resource companies and a major producer and marketer of more than 60 commodities that advance everyday life. Through a network of assets, customers and suppliers that spans the globe, we produce, process, recycle, source, market and distribute the commodities that support decarbonisation while meeting the energy needs of today. 

With around 140,000 employees and contractors and a strong footprint in over 35 countries in both established and emerging regions for natural resources, our marketing and industrial activities are supported by a global network of more than 40 offices. 

Glencore's customers are industrial consumers, such as those in the automotive, steel, power generation, battery manufacturing and oil sectors. We also provide financing, logistics and other services to producers and consumers of commodities.

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We recognise our responsibility to contribute to the global effort to achieve the goals of the Paris Agreement by decarbonising our own operational footprint. We believe that we should take a holistic approach and have considered our commitment through the lens of our global industrial emissions. Against a 2019 baseline, we are committed to reducing our Scope 1, 2 and 3 industrial emissions by 15% by the end of 2026, 50% by the end of 2035 and we have an ambition to achieve net zero industrial emissions by the end of 2050. For more detail see our 2022 Climate Report on the publication page of our website at glencore.com/publications.

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