Glencore has shown its willingness to pull out all stops to maintain operations at the Mount Isa copper smelter ahead of an investment decision on major maintenance programs due in 2026.
The company offered a rare briefing prior to the launch of the city council’s Mount Isa Future Ready Economy Roadmap today which looks at options to diversify the economy
Main image: MICO Copper Smelter
The stakes are high in the face of the impending staged closure of Mount Isa Copper Operations early in the new financial year.
Glencore has revised the number of ‘job impacts’ to 500 when the Enterprise and X-41 mines close along with the copper concentrator.
The smelter is due for a major maintenance program costing tens of millions of dollars.
The smelter unicorn
The smelter and Townsville-based refinery are part of MICO operations and are scheduled for closure in 2030.
Glencore said that was pending an investment decision ahead of a major maintenance operation in the form of the stack reline or ‘rebrick’ which is required in 2026.
What makes the smelter exceptional is its place in the value chain.
The smelter produces copper plate called anode to around 99.7 percent purity.
The sulphur dioxide gas released during the process is captured and transferred to a nearby acid plant owned by Incitec Pivot (IPL).
From there more than one million tonnes of sulphuric acid a year is transported to the IPL Phosphate Hill operation for use in their benefaction process.
By extension, no smelter equals no locally produced acid, which compromises IPL operations.
Also, the anode is transported to Townsville by rail to the Glencore-owned Copper Refineries Limited (CRL) located in the south-western suburb of Stuart.
From there, the anode plate is refined to 99.95 percent pure metal and shipped to market through Port of Townsville as commercially ready metal plate.
CRL is one of only two copper refineries in Australia.
Pulling out the stops
Glencore has been ramping up its third-party, or toll-milling, smelting offer.
It’s looking locally for supply and currently provides services to Evolution Mining’s Ernest Henry operation located north of Cloncurry, among others.
The smelter accepts toll product from as far away as South Australia’s Carrapateena operation owned by Oz Minerals and Prominent Hill owned by BHP.
Access to the smelter is otherwise a mitigating factor in the viability of junior miners. On again, off again customers include True North Copper and Aeris Resources.
On the downside
The smelting business was facing headwinds in the immediate future, Glencore Zinc assets Australia chief operating officer.
Some of the ‘old faithful’ suppliers that MIM could rely on for toll milling including Osborne, Eloise and Capricorn Copper were calling for less services.
The challenges the smelter and refining operations faced were broad and driven by dramatic changes in the global smelting and refining market.
For a start, there are more smelters being built internationally, including in Indonesia, China and India, with government support.
This to the extent that treatment charges had reduced from $90/t to $20/t.
It also means more competition for concentrate, which means higher prices.
MIM is faced with re-bricking the smelter’s stack at a cost of between $40 million and $60 million next year. The investment decision was pending.
Glencore had shown its commitment to Mount Isa Mines, COO Glencore Zinc Assets Australia Sam Strohmayr said.
“Mount Isa Mines is an important asset for Glencore globally and we’re committed to continuing operations and investment well into the future,” he said.
“Over the past five years alone, we’ve invested $1.8 billion into the Queensland Metals business, including $653 million on zinc mining and processing, $220 million on copper processing and $87 million on exploration.”
