Diversified major Glencore has confirmed that it is relinquishing its mining rights in Colombia, after the National Mining Agency (ANM) last month declined Prodeco’s request for its coal mines to remain on care and maintenance.
Glencore says that it remains uneconomic to restart operations at Calenturitas and La Jagua, which were placed on care and maintenance in March last year.
Prodeco conducted another operational review to identify further cost efficiencies, given that the ANM expected prices to remain low in Prodeco’s target markets. Glencore stated that the conclusion of the review was no different to previous ones.
“The decision to relinquish the mining contracts was not taken lightly and is a disappointing outcome,” the company stated on Thursday, noting its Prodeco subsidiary had invested more than $3-billion over the last 30 years and paid another $3-billion in royalties and taxes.
Prodeco would engage with its employees, contractors and host communities on the impact of relinquishing the titles. The subsidiary has restarted the voluntary redundancy programme.
Prodeco also operates the Port of Nuevo, which would continue to operate in line with its obligations as a public service port, and has a 39.76% stake in the Fenoco railway.