GLENCORE said on Wednesday an agreement with Gécamines to access additional land titles had boosted ambitions to increase production from its Kamoto Copper Company (KCC) in the Democratic Republic of Congo to 300,000 tons a year.
Announcing a 6% decline in full year adjusted Ebitda to $13.5bn for the 12 months ended December, Glencore said a deal with the DRC’s state-owned miner Gécamines would unlock “a comprehensive package of long-term mining titles and leases” and increase KCC’s life of mine into the 2040s.
Glencore produced 247,800 tons of copper from its African Copper operations last year, including Mutanda, an increase of 10% year-on-year.
In December, the miner unveiled plans to expand copper production to around one million tons annually by the end of 2028, and then to 1.6 million tons/year by 2035.
“Today we announced the finalisation of the KCC land access package with Gécamines, unlocking LOM extension, productivity and cost improvements and the pathway to approximately 300,000 tons of copper production,” said Glencore CEO Gary Nagle.
The deal replaces an earlier proposal in 2019 with the difference being that in the new proposed agreement Glencore will lease the land for the life of mine rather than own it. “It’s on the same terms but the structure has changed,” said Nagle in response to analyst questions at a presentation.
The closing of the agreement is subject to the registration of the mining titles lease agreements in the mining cadastre, which is expected to occur in the coming months, said Glencore.
“This provides greater confidence over the asset’s production recovery profile from 189,000 tons in 2025 to about 300,000 tons by 2028,” said analysts at Deutsche Bank.
Glencore’s African Copper assets have underperformed in recent years but appear to be on an upward trend. Second half copper production of over 500,000 tons was almost 50% above the first half, primarily due to higher copper grades and recoveries at KCC, Mutanda, Antapaccay and Antamina, Glencore said.
The deal with Gécamines comes after Glencore agreed to sell a 40% stake in its African copper mines to Orion CMC – a venture led by Orion Resource Partners, the US International Development Finance Corp and sovereign fund, Abu Dhabi’s ADQ. The deal valued the African copper assets at about $9bn.
The transaction will establish a new company 60% owned by Glencore and 40% by Orion CMC which could pursue additional opportunities in the Central African Copperbelt spanning Congo and Zambia, according to reports.
$2bn payout
Combined with a reported exit from Kazzinc and the future sale of its Bunge stake, the sale of a stake in African Copper could generate cash of more than $10bn and will throw the spotlight on Glencore’s future cash distribution plans, said Goldman Sachs analyst, Matt Greene. It may underpin shareholder returns or strengthen the balance sheet should Glencore consider alternative merger and acquisitions, he said.
For 2026, Glencore set out a base dividend of 10 US cents per share, and a proposed top-up of 0.07c/share owing to the Bunge divestment – equal to a total gross payout of about $2bn in two installments. “While the base dividend was broadly in line with our expectations, we did not forecast an additional top-up as we had pencilled in a higher net debt versus what was reported today ($11.2bn),” said Morgan Stanley.
For 2025, the group returned $3.1bn to shareholders consisting of $1.9bn in its share buy-back programme and a further $1.2bn in dividends.
