Noranda Income Fund Extends Terms of Agreements With Glencore Canada

TORONTO, Nov. 05, 2020 (GLOBE NEWSWIRE) -- Noranda Income Fund (TSX:NIF.UN) (the “Fund”) announced today that it has extended its exclusive agreements with Glencore Canada for the purchase of zinc concentrate and the sale of zinc metal for an additional period of three years through to April 30, 2025. The Supply and Processing Agreement (“SPA”) non-renewal notice period has also been amended to 540 days before April 30, 2025 or any subsequent renewal date thereafter, an increase from the 180 days required by the original agreement.

In addition, in the event of a non-renewal of the SPA, Glencore Canada has agreed to use reasonable commercial efforts to provide the Fund with transitional assistance as may be reasonably required to allow the Fund to secure zinc concentrate and to market the zinc metal it produces following the expiry date of the SPA.

“Confirming the extension of our agreements with Glencore Canada at this time represents an important development for the Fund, bringing added stability as we move forward with strategic expansion projects that aim to strengthen our processing facility’s market positioning,” said Anthony Lloyd, Chairman of the Board of Trustees of Noranda Operating Trust. “We are also very pleased with the amended non-renewal notice period and Glencore Canada’s undertaking to provide transitional assistance. This provides the Fund with a longer period of time to plan an orderly transition in the event that Glencore Canada elects for the agreements not to be automatically renewed.”

“We are extremely pleased that the agreement with Glencore Canada for the exclusive purchase of concentrate and the sale of zinc metal has been extended through to April 30, 2025. The extension avoids any uncertainty regarding our source of supply through to that period and allows us to put all of our focus on our operations and safely moving forward with our strategic expansion projects,” said Liana Centomo, Chief Executive Officer of Canadian Electrolytic Zinc Limited, the Fund’s manager.  

Contract Amendments
In January 2017 and March 2018, the Fund entered into agreements pursuant to which Glencore Canada, as principal, will supply the Fund with all of its zinc concentrate requirements and purchase all of the Fund’s metal for the twelve-month period ended April 30, 2018 and the four-year period ending April 30, 2022, which aligns with the end of the current term of the SPA.