Glencore mulling sale of gold mine in Kazakhstan

Glencore mulling sale of gold mine in Kazakhstan

Furnace operators at Glencore's Kazakhstan precious metals refinery. Image: VisMedia

Miner and commodities giant Glencore (LON:GLEN) is said to be exploring options for its largest gold mine — which could include a $2 billion sale — as it ramps up efforts to cut its debt burden.

Chinese companies are the most likely to show interest in Glencore’s Vasilkovskoye gold mine.

The sale of the company’s 70% stake in its Kazakhstan-based mine would bring Glencore closer to its target of cutting net debt to below $18 billion this year, people familiar with the company’s plan told The Wall Street Journal.

The report adds that Chinese companies are the most likely to show interest in Glencore’s Vasilkovskoye mine, thanks to the way gold prices have climbed back up this year.

Gold is one of the best-performing commodities so far this year, behind only iron ore. The yellow metal rallied past $1,300 an ounce for the second day in a row Tuesday, prompted by a weaker dollar and buying from speculative investors.

Vasilkovskoye’s gold output is pegged at roughly 350,000 ounces a year. A smaller gold mine Glencore used to own in Kazakhstan, Komarovskoye, was sold in April to Polymetal International for an initial $100m.