All anyone is talking about at the moment, is the announced closure of the Mount Isa Mines. But is it really worth all the hype it is gaining? Well if you ask me, I don’t think it is, and below is my reason.
If you don’t know who I am I’m Stef Uppman, Licensee of 4825 Realty. I am a Mt Isa local of nearly 20 years, a home owner and local investor, and have worked the Real Estate industry of well over 10 years.
Firstly, I have very low opinions of the Channel 9 ‘Breaking News’ segment that was aired at 7pm Tuesday 17th October. There was a failure to provide any information and in my opinion was about as equivalent as a clickbait advertisement. It caused a lot of emotions to run high with the tag line ‘Mount Isa Mines Closing’.
Now for some actual relevant information:
On Wednesday 18th October 2023; Glencore Mining Group have stated their intention to move forward with the closure of the Mount Isa Copper Mine. Their intention is to cease operation by 2026.
This is NOT NEW information.
In 2021 Glencore moved their intended life expectancy from 2023 to 2026. And today have announced that this will be going ahead.
My understanding is that the reasons behind the closure was that the Copper Ore body currently being mined is of lower quality to what it was in the past. The mine is also nearing it’s 100 year anniversary; meaning that there is aged infrastructure but that there are also safety concerns regarding the ore mining. For example, the mine is 35 levels deep; being estimated 1.7km deep and 1,000km wide. The mining tunnels are for lack of better words like tree roots or a rabbit’s warren. There was zero planning regarding layout and due to distance, it is uneconomical to commute the ore from the lower levels to the upper levels of the mine. You also have the low price of Copper trading which has failed to increase since the drop from late 2020.
All of these factors contribute to the decision that it is uneconomical to continue to mine Copper here. There is an expected job loss/change of est 1200 people from the Copper mine. However, Glencore have stated their intentions to either reassign or retrain the substantial amount of the employees with very limited redundancies to be offered. This to me represents their intention to re-employ these employees in their other sister projects around the town; whether that means that some FIFO worker contracts will be reconsidered.
At the Mount Isa Copper mine location there is also the Lead Smelter, Zinc/Lead Concentrator and Copper Smelter; all of which are to remain operational with no end date in mind. The Copper Smelter alone is a major income source for Glencore due to the fact that it processes ore through this smelter from numerous other mines; it is not solely for the use of Glencore alone. The smelter is one of the largest processors in Australia and recently had a furnace rebrick completed in 2022 being a multimillion dollar expense.
Mount Isa Mining Area
For those unfamiliar with our area, the Mount Isa Copper Mine IS NOT the only mine around Mount Isa. Multiple local mines surround our area, with the main mine being the George Fisher Mine; located 20km outside of Mount Isa; which employs in excess of 2500 employees and has a long-life expectancy. Based in Cloncurry; being 161km away; is Evolution Ernest Henry mine which is a Copper/Gold mine. There are also a collection of smaller mines surrounding the area with Mount Isa being the main centre hub for supply and air transport to the area. I have previously created an Information booklet regarding the Mt Isa area, and this can be viewed by clicking here if you are interested.
So what is my opinion?
With all the above in mind, am I concerned regarding this media release?
If I am being honest, the answer is No.
My first thought is that the inital news release was conveniently slipped to only one news outlet; with no other outlets having any information regarding the release until the following day. To me that is suspicious in itself.
But this is not the first time that Glencore has made a statement regarding the mine closure. In the past Glencore has received incentives from the Qld Govt to continue the mine life; and this has once again been seen with the announcement of a $50 million incentive from the Palaszczuk govt.
How this incentive is to be used/distributed is yet to be released.
I have always been open about my theories regarding Glencore announcements with upcoming elections. And it seems the timeline is once again correct, with the Qld Govt election upcoming in 2024. With Glencore making numerous statements in the past regarding some of the policies introduced by the Palaszczuk govt to be reconsidered in matters regarding mining.
I am however concerned that this is the first time Glencore has announced to their employees their intention to close. However as mentioned, it has been stated they intend to reassign as many employees as possible who are willing. And I do have beliefs that there is a future use outside of underground mining for this area; however, it is too soon for us to confirm if this thought is correct.
As always, I do recommend that you complete your own research and due diligence and do not take my opinion as facts.