Glencore to stop funding troubled New Caledonia nickel plant (updated)
27/09/2023 13:37
(Recasts headline, paragraph 1, adds background from paragraph
3)
Sept 27 (Reuters) - Glencore Plc GLEN.L said on
Wednesday it will stop funding the loss-making Koniambo Nickel
SAS (KNS) business it co-owns in New Caledonia at the end of
February, adding to pressure on the troubled nickel sector in
the French Pacific territory.
The commodities miner and trader, which has funded KNS with
$9 billion since its inception, said it will work with the
company, its joint shareholder and the French government to
explore solutions for ongoing losses, including looking at
alternative sources of funding.
The French government is currently overseeing discussions to
reorganise the nickel industry in New Caledonia, which has some
of the world's largest reserves of the metal, but whose three
smelters have faced years of losses linked to high costs and
social unrest.
French mining group Eramet ERMT.PA , the majority owner of
SLN, another New Caledonian nickel producer, has said previously
it will not provide further financing for the unit.
The French government granted SLN a 40 million euro ($42.17
million) emergency loan earlier this year to avert a financial
collapse.
Glencore has a 49% stake in KNS alongside the northern
provincial authorities in New Caledonia.
($1 = 0.9486 euros)
(Reporting by Deep Vakil in Bengaluru and Gus Trompiz in Paris;
Editing by Toby Chopra and Sharon Singleton)
((gus.trompiz@thomsonreuters.com; +33 1 49 49 52 18; Reuters
Messaging: gus.trompiz.thomsonreuters.com@reuters.net))