Glencore will continue to supply coal to Eskom during lockdown

Glencore will continue to supply Eskom with coal during the nationwide lockdown but has transitioned its SA ferro alloys operations to care and maintenance, the global mining and trading giant said on Thursday.

The nationwide lockdown will span 21 days from Friday to April 16 in a bid to arrest the spread of Covid-19 in SA.

“During the nationwide lockdown we will continue to supply coal to Eskom under the guidelines issued by the department of mineral resources,” the group said in a statement on Thursday.

“With effect from midnight tonight, the Middelburg and Graspan coal operations will be on care and maintenance, supported by skeleton crews to maintain essential services.”

Glencore, headed by SA-born billionaire Ivan Glasenberg, said any export of coal will need to be approved by the department.

The group, which has operations across the globe, said various governments have imposed far-reaching restrictions in response to the pandemic. However, “to date, our larger operations have not been materially affected. However, a number of our smaller assets have had to restrict or stop operations,” it said.

In Canada, where the government of Quebec has ordered all non-essential businesses to close, Glencore’s  Raglan nickel and Matagami zinc operations will be on care and maintenance for the next three weeks. In Ontario mining has been designated an essential business and so Glencore assets can continue to operate.

In Chad disruptions to international mobility, transport and supply chains have prompted Glencore’s wholly owned PetroChad to take steps to stop production at its Badila and Mangara oilfields. The facilities at the fields will be secured and remain on care and maintenance, the transition to which will be completed towards the end of April.

In Colombia, a 19-day quarantine was imposed from March 25 and though mining is exempt, Glencore said growing community tensions and restrictions on logistics have made it difficult to ensure the continued and safe operation of its Prodeco coal mine and the security of its host communities and so the operation has transitioned to care and maintenance.

The group said the situation is evolving rapidly and it would continue to provide updates as appropriate. “Glencore is committed to working with all its stakeholders in helping overcome the unprecedented challenges presented by this pandemic,” it said.

steynl@businesslive.co.za