Glencore makes R2. 8bn payments to South Africa amid energy transition plans

IOL News

17-06-2025

Glencore expects to fulfil expenditure obligations related to its acquisition of Astron by September 2027 after initial payments totalling $185m as at September last year.
Image: Reuters
Tawanda Karombo
Glencore on Thursday said it made tax, royalty and duty payments amounting to $157 million (around R2.8 billion) to South Africa in 2024 as it considers dialogue with government and other players as key for the country's energy transition.
In the year to December 2024, Glencore's total payments to governments in markets in which it operates topped $3.7bn, calculated 'in line' with the UK Transparency Requirements.
Over the same period, Glencore suffered about $611m worth of impairments in its South African operations, significantly contributing to the company's $1.6bn in losses to equity holder.
The $157m in payments to the South African government for 2024 were accounted for by $111.5m in income taxes, $45.3m in royalties.
An additional $1.2bn in 'taxes and duties relating to non-extractive activities plus other taxes' was also paid to SA during the same period, said the company.
By province, the multinational commodity trading and mining company's ferroalloys project in Limpopo paid $69.7m to the government while its energy coal operation in Mpumalanga contributed $41.1m.
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The company's manganese project in the Northern Cape made payments of $2.2m, in addition to the $43.8m paid by its ferroalloys operation to the North West provincial government.
Glencore expects to fulfil expenditure obligations related to its acquisition of Astron by September 2027 after initial payments totalling $185m as at September last year.
Despite taking impairments to its South African operations in the past year, Glencore has committed to its 2024-2026 Climate Action Transition Plan.
The company has 'determined that the relevance of a just and orderly transition for our industrial business is greatest in Colombia and South Africa' where it is focusing its efforts.
'The complexity of the energy transition in South Africa and the scale and potential significance of its impacts mean a multi-stakeholder approach is essential,' noted Glencore.
'We welcome ongoing efforts, and particularly support dialogue with all industry participants to help holistically identify and mitigate risks associated with operational changes.'
It said it deemed dialogue as key to enable a transparent, predictable, and stable approach to the energy transition in South Africa.
Moreover, Glencore said the predictability of the transition roadmap around planned closures of coal-powered power stations was necessary to enable a robust response that deploys actions in an effective manner supportive of communities.
Some of Glencore's coal operations in South Africa are located in a designated Renewable Energy Development Zone. It said the rehabilitation plans for the coal mines created opportunities 'to investigate renewable energy generation facilities for community use as long-term alternative land use' options.
'We support the efforts by the South African government to develop the policy framework that enables the just and orderly transition, and to commence the relevant planning,' it said.
Glencore is supportive of the planned implementation of virtual wheeling, which allows consumers to purchase renewable power from any producer across the country.
This allows companies with multiple smaller and low-voltage loads across various geographic areas in South Africa to participate in the energy market.