Ecuador court gives green light for Silvercorp, Salazar’s El Domo project
The ruling removes the last major obstacle for the $250 million project, located 150 km northeast of Guayaquil.
Glencore Plc’s purchase of a giant Colombian coal mine has cost the commodities trader and mining powerhouse much less than initially thought after prices of the fuel surged.
The company on Tuesday said it completed the acquisition of the Cerrejon mine, following a deal struck in June to take full control of the asset from partners BHP Group and Anglo American Plc. At the time, Glencore agreed to pay about $588 million, while also taking cash flows for the year. It estimated a final cost of roughly $230 million.
But after thermal coal prices surged to a record high over the period — underpinned by a global energy crunch — Glencore said the cash payment on completion of the deal totals just $101 million.
Anglo and BHP, which both agreed to sell their stakes for $294 million each, have been in the process of exiting the fuel amid increasing pressure from shareholders over mining the most polluting fossil fuel. While the deal marks the end of thermal coal mining for Anglo, BHP’s future is less certain as it mulls the continued ownership of its last mines in Australia.
Benchmark prices for thermal coal exported from Australia hit a record in October, though pulled back after China rolled out measures to ease a supply crunch that contributed to power shortages. Still, prices continue to be volatile amid concerns around exports from Indonesia.
The Cerrejon purchase was the last major deal of former Chief Executive Officer Ivan Glasenberg, before he left Glencore at the end of June, ending two decades at the helm of the world’s biggest commodity trader.
(By Thomas Biesheuvel)
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