Glencore scraps plans to build one of world's largest coal mines

Glencore Plc abandoned plans to build a controversial coal mine in Australia that would have been one of the largest in the top exporter, citing global uncertainty and its plans to phase out emissions.

The company won't develop the A $2 billion $1.3 billion Valeria project in Queensland's Bowen Basin, it said Thursday. The site would have produced about 20 million tons of coal a year, and had been a major source of global carbon dioxide over its 37 year lifetime.

The move comes as major miners, including Rio Tinto Plc and BHP Group Ltd., withdraw from fossil fuels in favor of minerals necessary for the low-carbon energy transition, such as nickel, copper, lithium and cobalt. Glencore said that there was a factor in the state government s coal royalty rates in Queensland that damaged investor confidence.

The decision was made in the context of increased global uncertainty and is consistent with Glencore's commitment to a responsibly managed coal business and our ambition of being a net zero emissions business by 2050, the company said in a statement.

Glencore will close 12 of its coal mines from 2019 to 2035 as part of a plan to halve its scope 1, 2 and 3 emissions by the end of the year, Chief Executive Officer Gary Nagle said earlier this week on an investor call, highlighting the company's shift to metals needed in the energy transition. Glencore operates 26 coal mines, most of which are in Australia, according to its website.

Nagle said these will be shut with a proper just transition and proper environmental management and closure plans. We are going to prioritize our CapEx towards our future-facing metals. That is where the business is going. Valeria was one of the largest coal mines under review by the Australian government. It has a pipeline of more than 30 projects with total production capacity of around 250 million tons of carbon dioxide and is estimated to spew out as much as 17 billion tons of carbon dioxide over their lifetime, or more than half of the global total in 2021.

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