Australian region facing 17,000 job losses as copper pressures hit

A town built on mining is facing upheaval as mounting pressures threaten copper operations and potentially thousands of jobs.

Up to 17,000 jobs could be lost if copper operations that have underpinned life in regional Queensland come to an end, as local leaders call for government intervention.

Glencore is closing its 60-year-old copper mine at Mount Isa, about 900km inland from Townsville, with its official last day on Thursday.

But that might not be the end of upheaval for the region.

The multinational resources giant is also considering the future of its copper smelter and its refinery, located in Mount Isa and Townsville respectively, with models predicting a $2.2 billion loss by 2031.

Glencore’s underground copper operations is due to close this week. Picture Glencore

Mount Isa Mayor Peta MacRae told news.com.au that some confidence had remained in the community since the underground mine’s closure was announced, as many jobs could be moved to Glencore’s nearby zinc mine.

But, she said, losing the smelter would have massive impacts not only for Mount Isa but the region and its interconnected industries.

“I mean, that was a pretty big blow (the mine closure), but we were going to be able to manage it,” Ms Macrae said.

“I think the closure of the smelter would be absolutely devastating. They’re talking 18 per cent unemployment in Townsville.

“So I just don’t think I can overstate the problem, to be honest.”

Mount Isa Mayor Peta MacRae has called for a solution. Picture: Evan Morgan

The mayor is in Canberra this week to lobby federal government ministers in the hope of securing a plan to keep the sites open.

Glencore is losing tens of millions of dollars per month on its copper operations due to economic pressures and growing global competition.

China has seen a government-subsidised copper smelting boom over the past decade and now accounts for half of the world’s refinery capacity.

Smelters also run on gas, with Australia’s high prices adding financial stresses.

Not only does it provide local jobs, but the Mount Isa smelter’s by-products also fuel another large employer in Dyno Nobel’s Phosphate Hill fertiliser plant.

The Phosphate Hill fertiliser plant relies upon the Mount Isa copper smelter for a supply of sulfuric acid. Picture: Supplied.

With the copper mine’s closure, the smelter is now fed by smaller third-party mines which would also face significant pressures if it closed down.

Gavin Starr, who runs Custom Steel Fab, said hundreds of small business and supporting industries would be affected if the plants close.

“You’d be hard pressed to find someone in Mt Isa who isn’t directly affected,” he said.

“We feel fear, frustration and disbelief.”

Glencore has confirmed it was currently reviewing a “detailed offer … of support for the copper smelter and refinery” from the Queensland government.

A spokesperson said the company was “grateful for this offer of assistance” but noted a “quite significant” economic gap remained.

“Bridging it will require support from both Queensland and federal government,” they said.

“At present we don’t have anything on the table from the Federal Government but we look forward to engaging further with Minister (Tim) Ayres in the coming weeks.”

Industry and Science Minister Tim Ayres. Picture Thomas Lisson

A spokesperson for Industry and Science Minister Mr Ayres told the Australian Financial Review that framing any talks as a “bailout” was not correct.

“They are a serious, necessary assessment of Australia’s capacity to process strategic and critical minerals now and into the future,” they said.

“We will continue to work closely with industry and state governments to advance our domestic industrial capability, in line with our Future Made in Australia agenda.”

Ms MacRae has said the Mount Isa resources sector had contributed $15 billion to the economy over the past decade and the region had “asked for very little” in return.

She told news.com.au that the dilemma facing the area was “right in the sweet spot” of federal government plans on Australian industry, critical minerals and developing northern Australia.

“So we might not want to call it a bailout,” Ms MacRae said.

“But what is essentially needed is economic support for a whole region to make everybody viable, because you can’t have your small copper mines without the smelter.

“So it has to be a whole package. But all of that takes time, and we don’t have time like that.”

Originally published as Australian region facing 17,000 job losses as copper pressures hit