Glencore’s Mopani Copper Mines subsidiary in Zambia is reviewing its business in a bid to slash spending as lower copper prices and uncertainty caused by the coronavirus pandemic take their toll, it said on Friday.
The comprehensive review aims to minimise cash outflow and any non-essential projects would be suspended, the copper miner said.
“The rapid decline in the price of copper due to the impact of COVID-19 has now placed significant additional pressure on Mopani’s operations,” the company said in a statement.
Copper prices are set for their worst week since 2011 after sliding 10% so far.
The metal, often referred to as “Dr. Copper” because it acts as a bellwether for the global economy, has been hit hard by the global slowdown caused by coronavirus.
Mopani said the review would give it the necessary financial flexibility to navigate the downturn.
The miner also said it had plans in place to reduce the risk of disruption to its operations from coronavirus. Several mines in Peru and one in Canada have shut due to the pandemic.
Mopani Copper Mines, which produced 119,000 tonnes of copper in 2018, is 73.1% owned by Glencore, 16.9% by First Quantum Minerals and 10% by Zambia’s mining investment arm ZCCM-IH.
(By Chris Mfula and Helen Reid; Editing by Olivia Kumwenda-Mtambo and David Clarke)