JOHANNESBURG - ANGLO AMERICAN will divest from its South African and Colombian thermal coal operations by mid-2023, the miner said on Friday as it sought to demonstrate to investors its commitment to a shift towards clean energy sources.
The global miner said a de-merger and listing on the JSE was the most likely route for its South African thermal coal assets.
Anglo American, which produces platinum, copper, diamonds, iron ore, and thermal and metallurgical coal, highlighted its green credentials as the mining industry faces increasing scrutiny over its carbon footprint.
“With the bulk of (growth) options in copper, PGMs, and now also crop nutrients, we are increasingly positioned to supply those metals and minerals that enable a cleaner, greener, more sustainable world,” chief executive Mark Cutifani said on Friday in an annual update to investors.
Cutifani said the company planned to exit its Cerrejon thermal coal mine in Colombia within one and a half to two years, while the South African thermal coal exit would happen within two and a half years.
Anglo American said production across all minerals would increase by 14 percent in 2021 and unit costs are expected to fall by 3 percent.
Capital expenditure would be between $5.7 billion (about R85.5bn) and $6.2bn next year, reflecting deferred 2020 spending and new investments.
Anglo American expects to deliver output volume growth of 20 percent-25 percent over the next three to five years, with the Quellaveco project in Peru producing its first copper in 2022.
The miner said it expected to produce 890 000 to 1 million tons of copper in 2023. It cut its 2022 copper production forecast, though, to 680 000-790 000 tons, from 700 000-810 000.
The De Beers owner also trimmed its diamond production forecasts for the next two years as the diamond unit reduces supply following a slump in rough diamond prices heightened by the pandemic.
Current diamond prices would increase pressure on producers and output would shrink unless they rally, Cutifani said.
Anglo American Platinum said it would return to pre-pandemic production levels from 2021.
Jefferies analyst Christopher LaFemina said the cuts to copper and diamond forecasts were “unhelpful” considering organic growth is a unique aspect of the investment case for Anglo American.
Anglo American’s share price fell -2.79 percent to R488.48 on Friday.