Glencore closes sale for Cobar copper mine

ALEXANDRA EASTWOOD

After selling its CSA copper mine in Cobar, New South Wales, to Metals Acquisition Corp (MAC) for $US1.1 billion ($1.64 billion) earlier this month, Glencore and MAC have officially closed the sale.

Under the transaction, Glencore has received $US775 million in cash and $US100 million in shares, along with:

  • $US75 million deferred payment to be paid within 12 months
  • $US150 million payment contingent upon future copper prices
  • 1.5 per cent life of mine net smelter return royalty

Glencore will offtake 100 per cent of the copper concentrate produced and MAC will assume ownership and the full operation of the mine.

“The acquisition of CSA represents a strong strategic fit for MAC. Our management team’s operational expertise, understanding of regional operations and relationships with local stakeholders uniquely position us to identify and realise the full potential value of the asset,” MAC chief executive officer Mick McMullen said in 2022.

“We believe that copper has favourable fundamentals that will continue to support an elevated copper price.

Copper is expected to play a key role in the global energy transition ‘megatrend’, with approximately one million tonnes per annum of new supply required from 2024 onwards in order to meet the surging demand forecast.

“With few new projects globally in the pipeline, increasing permitting issues and jurisdictional risk, and declining copper grades across the industry, we believe that there are significant challenges ahead to close the projected supply deficit.”