Glencore Adds Two Copper Mines to Disposals Program

Switzerland's Glencore plc on Monday, Oct. 12, put two copper mines on the block, firing the starting gun on $2 billion of asset sales that are part of a wider plan to cut debt by $10 billion. The Swiss-based mine operator and trading company is auctioning its wholly owned Cobar underground mine in New South Wales, Australia and the above-ground Lomas Bayas mine in the Atacama desert of Chile. Cobar produces about 50,000 tons of copper each year, while Lomas Bayas produces 75,000 tons of copper cathode. 'At a guess Glencore could get $500 million for the two mines,' Numis Securities Ltd.'s Matt Hasson noted on Monday. 'While this would be useful for Glencore it doesn't really move the needle with regard to net debt reduction.' Neither of the mines were part of the initial $2 billion of assets that Glencore had earmarked for sale on Sept. 8, when it announced plans to sell output from its precious metals operations and a stake in its agricultural unit. Glencore is under pressure to cut its $30 billion of debt, which some analysts believe could wipe out shareholder value at the company unless commodity prices rise.