Swiss commodity trading and mining company Glencore has unveiled its plans to stop providing funding for the Koniambo Nickel SAS (KNS) business, beyond 29 February 2024.

Glencore said that the KNS mine made significant progress in productivity performance and reliability. However, the operation struggled financially and incurred significant losses.

The operation faced losses largely due to cost structures and market conditions.

In its recent report, the French Inspector General of Finance (IGF) said that the nickel industry in New Caledonia is facing significant challenges and needs far-reaching changes.

The Swiss mining company will work with KNS and relevant stakeholders to explore solutions for ongoing losses, including alternative sources of funding for KNS.

Glencore, in its statement, said: “Glencore will continue to provide financial support during this period, according to the budget, and remains committed to ensuring that KNS operates safely, maximising production and reducing costs.

“We will also continue to support KNS to explore alternative processing routes, lock down reverse polarity improvements, and study any other initiatives to help increase the value of the operation.”

Glencore has been providing significant funding for KNS, including a total of $9bn since project inception, and $3.9bn since the acquisition of Switzerland-based Xstrata.

The Swiss mining company has supported KNS in creating a local workforce, developing a contractor ecosystem, and operating and safety standards.

In addition, the company brought wider socio-economic benefits that contribute to the community and explore paths toward an energy transition.

Glencore will continue to work with KNS, its shareholders and the French Government to implement any solutions identified in the IGF report, and any other funding options for KNS.

In a separate development, Glencore has purchased at least 5,000 tonnes of Russian copper, routed through Turkey to Italy, in July this year, reported Financial Times.

The copper metal from Russia’s Ural Mining and Metallurgical Company (UMMC) was reportedly sold by UAE-based Haldivor Energy.

It was purchased by Glencore and exported through Turkey to Italy’s Livorno port.