Glencore (LSE:GLEN,OTCPL:GLCNF) is in talks with Canadian federal and Quebec provincial authorities over a potential deal to keep the Horne smelter operating after stricter emissions rules put a key piece of North America’s copper supply chain at risk.
Canada’s only copper smelter, located in Rouyn-Noranda, has been at the center of negotiations since Glencore suspended upgrade plans last month, citing uncertainty over new arsenic limits.
The company warned the plant could be wound down without changes to the regulatory framework.
Quebec has proposed legislative amendments that would delay implementation of tougher emissions standards. The revisions would push a new arsenic cap of 15 nanograms per cubic meter to 2029 and maintain that level until at least 2033.
The limit is one-third of current permitted levels but remains five times higher than the province’s benchmark safety standard.
At the same time, Ottawa is considering a request for about US$108 million in financial support to help fund pollution-control upgrades, according to people familiar with the matter.
“While awaiting regulatory certainty, we are open to evaluating other mechanisms, particularly financial ones, for sharing risks,” Glencore said in an email to Bloomberg.
The Horne smelter processes about 215,000 metric tons of copper concentrate and scrap annually, representing roughly 16 percent of North America’s smelting capacity. There are only a small number of operating smelters across the US and Mexico.
The facility also supplies Glencore’s Canadian Copper Refinery in Montreal. The company has said about 3,200 direct and indirect jobs could be affected if the smelter closes.
It also produces copper as well as byproducts including gold, silver, platinum, palladium, and sulfuric acid, and processes about 100,000 tons of electronic scrap each year.
Glencore has spent about US$130 million on emissions reduction measures, including acquiring more than 50 homes to create a buffer zone around the site. A total of 82 properties are slated for demolition.
The negotiations come as the facility faces ongoing scrutiny over emissions. Medical data has shown higher rates of chronic obstructive pulmonary disease in Rouyn-Noranda compared with provincial averages, and a class-action lawsuit tied to emissions was authorized last year.
Public health officials have warned that delaying stricter emissions targets could prolong exposure risks, particularly for nearby residents.
Meanwhile, Quebec officials have defended the proposed timeline changes, arguing they are necessary to enable investment while maintaining compliance. Quebec Environment Ministry spokesperson Louis Potvin maintained the amendment would allow the Horne smelter to proceed with required upgrades and meet its permit conditions, including the 15 nanograms per cubic meter arsenic limit.
“The ministry took into account the position of the national public health authority, which deemed the postponement acceptable last October, and the City of Rouyn[-Noranda] also supported this postponement,” Potvin said in an email to CBC news.
The outcome of the talks will determine whether the company proceeds with its investment or begins winding down operations at one of the region’s few remaining copper smelting facilities.
Don’t forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
