Glencore to sell 23% stake in Peruvian miner Volcan

Delivering 2022 results, the Swiss company said the move was part of its efforts to further simplify the business and continue to delivering value to its investors.

Glencore, the first of the world’s top diversified miners to post 2022 earnings, announced on Wednesday it would return more than US$7 billion to shareholders in dividends and buybacks thanks to a record profit of US$34.1 billion.

Volcan is not the only interest the Baar, Switzerland-based firm has in Peru. It also holds a stake in the copper mine Antapaccay, whose operation has been disrupted by the protests against President Dina Boluarte.

Antapaccay was shut for 11 days on security concerns following violent attacks in January. The operation is one of Peru’s largest, producing nearly 136,000 tonnes of copper between January and November 2022.

Peru, the world’s No. 2 copper producer, has been gripped this year by rising political and social unrest triggered by the destitution of President Pedro Castillo late last year.

The wave of intermittently violent demonstrations has already imperilled 30% of its copper output and could choke off access to almost US$4 billion worth of the metal. 

Data from Peru’s ombudsman’s office shows that 58 people have been killed and 1,792 injured in protests since Dec. 7, when Congress removed Castillo, the country’s second Indigenous president, and arrested him.  

Protesters have demanded either Castillo’s reinstatement or new elections, which are options experts believe are unlikely to come to fruition.

“As civil unrest fuels disruption, we expect shipments from Peru, which also produces significant volumes of zinc, tin and silver, to be impacted over the coming months, and congress shows no sign of calling a general election in the immediate future,” commodities analyst for BMO Capital Markets, Colin Hamilton, wrote earlier this month.

Besides political reasons, the current unrest is Peru is being fuelled by longstanding grievances about high poverty levels and discrimination felt by many in Peru’s Andean and Amazonian regions. 

The country’s south is rich in copper, but locals say the benefits of mining don’t reach the communities who live close to the many operations.