Recent government policies, such as the United States’ Inflation Reduction Act and the European Union’s proposed Green Deal Industrial Plan, demonstrate the growing need for critical raw materials through to the end of the decade and beyond, necessitating fresh investment in both primary supply and recycling, said Glencore CEO Gary Nagle on Wednesday, when the diversified mining and marketing company reported stunningly high record 2022 earnings.

“As we run down our coal business, we’ll continue to invest in our critical minerals and provide the minerals and metals needed for the decarbonisation of the world’s energy grid.

“There are significant growth prospects in our copper business in particular, but also potential growth prospects in nickel and cobalt and we’ll bring those materials into the market as the world need them to decarbonise and supply the minerals of tomorrow, while we supply the energy needed today,” said Nagle.

The London- and Johannesburg-listed company’s earnings before interest tax depreciation and amortisation (Ebitda) were up 60% at $34.1-billion, with net income up 107 % at $18.9-billion. Shareholder returns totalled $7.1-billion or $0.56/share.

“It’s been a phenomenal year on the marketing side,” said Nagle, with marketing Ebit double the top end of the guided range. Equity-free cash flow was $24-billion and the year ended with virtual zero net debt.

“We’ve been able to provide our customers with the energy security they need, the minerals they require to be able to navigate a very volatile world,” Nagle added.

Glencore has made considerable climate mitigation progress, with Glencore industrial assets head Peter Freyberg and his team working extensively on what the company refers to as its marginal abatement cost curve (MACC), which reduces Scope 1 and 2 emissions through evaluating operating efficiency, fuel switching, renewable energy and technology options.

MACC provides the framework for Glencore to pursue the most cost-effective reductions and to stay one step ahead of any carbon price. In this way, it intends to decarbonise in a manner that is value accretive or free of charge.

All new mine projects have renewable energy as Glencore embarks on its journey to reduce emissions by 15% by 2026 and by at least 50% by 2035.

A carbon capture utilisation and storage pilot project is being advanced in Australia amid the International Energy Agency’s standpoint that the world needs all technologies to be able to meet its net zero ambition by 2050.

Continued capital investment is underway into recycling of minerals, which is seen as being a profitable was well as a responsible pursuit to close the supply gap and to decarbonise.

Ongoing Swiss and Dutch governance investigations into the company are being met with cooperation, following the resolution governance investigations in the US, UK and Brazil.

“We’ve unfortunately lost four of our colleagues this year and this is something that we take incredibly seriously. It is the single most important driver of our company. Peter Freyberg and his team work relentlessly to keep our people safe and that we target zero harm in this company. We haven’t achieved that objective, but it is the number one objective that we have in this company, and we will not rest until our people are all safe,” Nagle emphasised during the presentation of results covered by Mining Weekly.

INCREASED UTILISATION OF RENEWABLES

In response to UBS mining research analyst Miles Allsop, Nagle said the company had seen increased utilisation of renewable energy across the whole of Europe.

Glencore Alloys head Japie Fullard, who is driving Glencore’s energy strategy around alloys, said in response to Mining Weekly during a media call, that multiple solutions are being investigated, with Glencore Alloys’ decarbonisation commitments being on-site projects involving potential cogeneration, and off-site virtual power purchase agreement (PPA) pursuits.

The cogeneration opportunity involves turning ...