Wrap Text
GLN - Katanga Mining announces agreement to acquire land rights from Gecamines
GLENCORE PLC
(Incorporated in Jersey under the Companies (Jersey) Law 1991)
(Registration number 107710)
JSE Share Code: GLN
LSE Share Code: GLEN
HKSE Share Code: 805HK
ISIN: JE00B4T3BW64
Baar, Switzerland
20 December 2019
KATANGA MINING ANNOUNCES AGREEMENT TO ACQUIRE LAND RIGHTS FROM GÉCAMINES
Glencore refers to the announcement today by Katanga Mining Limited ("Katanga") in which it announced that
Katanga's 75% subsidiary Kamoto Copper Company (“KCC”) has entered into an agreement with La Générale
des Carrières et des Mines (“Gécamines”), its 25% joint venture partner in KCC, to acquire from Gécamines a
comprehensive land package covering areas adjacent to KCC’s existing mining concessions.
The land includes multiple blocks over the preferred location for construction of a new long-term tailings facility,
and multiple other blocks that will enhance KCC’s ability to more efficiently operate its mines, facilities and other
key infrastructure requirements. If this agreement is implemented then the risks for KCC’s operations resulting
from land constraints, which are described in the Company’s 43-101 Technical Report issued on 7 November
2019, would be mitigated.
KCC will pay up to USD 250 million to acquire the land, the total amount payable being dependent on delivery of
title to the various different land areas.
The agreement also provides for (among other matters):
(i) an initial payment of USD 150 million to Gécamines which will be fully offset against the purchase price
consideration or other payment obligations of the Company to Gécamines from time to time,
(ii) obligations on KCC to remove tailings (estimated at circa 15m dmt), currently in a sub-section of these
areas, to another suitable proximate location,
(iii) warranties and indemnities from Gécamines concerning the land interests to be transferred,
(iv) contingent obligations to pay “pas de porte” payments to Gécamines if KCC declares a JORC compliant
reserve or otherwise elects to mine any resources in certain of the acquired land areas, on substantially
the same terms as in the Settlement Agreement announced by KCC in June 2018. An amount of up to
USD 120 million of the consideration may be offset against these pas de porte obligations, and
(v) a new royalty to Gécamines of 2.5% of net sales from the acquired land areas if KCC elects to mine any
resources in the acquired land areas.
KCC expects to satisfy the consideration payments from existing liquidity. The agreement anticipates the title
transfers to be effected during the course of 2020.
The entering into of this acquisition agreement between Katanga and Gécamines constitutes a smaller related
party transaction as defined in UK Listing Rule 11.1.10 because Gécamines holds more than 10% of the voting
rights in a material subsidiary of Glencore. Accordingly, Glencore has obtained written confirmation from a
sponsor under the UK Listing Rules that the terms of the agreement with Gécamines are fair and reasonable as
far as the shareholders of Glencore are concerned.
For further information please contact:
Investors
Martin Fewings t: +41 41 709 2880 m: +41 79 737 5642 martin.fewings@glencore.com
Maartje Collignon t: +41 41 709 3269 m: +41 79 197 4202 maartje.collignon@glencore.com
Charles Watenphul t: +41 41 709 24 62 m: +41 79 904 33 20 charles.watenphul@glencore.com
www.glencore.com
Glencore LEI: 2138002658CPO9NBH955
Notes for Editors
Glencore is one of the world’s largest global diversified natural resource companies and a major producer and
marketer of more than 60 commodities. The Group's operations comprise around 150 mining and metallurgical
sites and oil production assets.
With a strong footprint in both established and emerging regions for natural resources, Glencore's industrial and
marketing activities are supported by a global network of offices located in over 35 countries.
Glencore's customers are industrial consumers, such as those in the automotive, steel, power generation, battery
manufacturing and oil sectors. We also provide financing, logistics and other services to producers and
consumers of commodities. Glencore's companies employ around 158,000 people, including contractors.
Glencore is proud to be a member of the Voluntary Principles on Security and Human Rights and the International
Council on Mining and Metals. We are an active participant in the Extractive Industries Transparency Initiative.
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Date: 20-12-2019 10:57:00
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