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Glencore will continue to run its copper smelter in Mount Isa and refinery in Townsville beyond 2022 after reaching an agreement with the State Government.

The company announced this week that it would receive a one-off incentive from the State Government and also planned to invest more than $500 million for the continued operation of the plants.

The incentive, offered under the Queensland Government’s North Queensland recovery plan, would partially mitigate the negative costs of running the assets – which faced high fixed costs and struggled to compete internationally, the company said.

“We recognise these metallurgical assets are an important part of North Queensland economy and part of a broader supply chain which supports thousands of jobs,” the company said in a statement on the decision.

It said the agreement secured ongoing employment for about 570 direct smelter and refinery workers and a further 1000 indirect jobs.

The State Government has not revealed the exact amount of the multi-million dollar support.

But it said the support package would allow for the four-yearly re-bricking and maintenance work at the smelter, due in September next year.

The Mount Isa copper smelter is integral to fertiliser manufacturer Incitec Pivot’s regional operations. A sulphur by-product is refined and transported via rail to the Phosphate Hill plant as a feedstock in its manufacturing process. 

Incitec Pivot managing director and chief executive officer Jeanne Johns said the Queensland Government’s support was a vote of confidence for the region. 

“The government’s investment will support north Queensland’s industrial capability and provide certainty for businesses and jobs in the region,” Ms Johns said. 

“Incitec Pivot’s operations across North Queensland support around 520 regional jobs.

“Today’s funding commitment underpins fertiliser supply and manufacturing at our Mount Isa and Phosphate Hill facilities, ensuring we can continue to provide jobs to support the agricultural sector.”

Treasurer Cameron Dick said the funding lifeline for the Glencore copper assets was part of the State Government’s $8 billion plan to protect the health, jobs and businesses of Queenslanders.

“Queensland needs to maintain minerals processing capability in the North West to keep supply chains open for future critical mineral developments and the jobs they will create,” he said.