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Company Response

23 May 2019

Response by Glencore

…The dispute between Glencore’s Prodeco coal asset and the Colombian Government stems from a 2010 amendment to the Mining Contract for the Calenturitas mine. In 2008, we proposed to expand the Calenturitas mine to increase coal production and extend the life of the mine. The expansion plan involved Glencore making substantial investments. The original royalty regime applicable to the Calenturitas mine would have become punitive in respect of the expansion to increase production. After 20 months of discussion, and in order to enable a significant expansion of the Calenturitas mine, the government and Prodeco/Glencore agreed an amendment to the royalty regime through an amendment to the Calenturitas Mining Contract, executed in January 2010. Regrettably, after the amendment was signed by both parties, and significant investments had been made to expand the mine on the basis of the amendment, the government sought to revoke and nullify the amendment that Colombia had signed.  The Swiss-Colombia Treaty requires that Colombia abide by the commitments it makes to investors like Glencore and Prodeco, and it requires that Colombia treat Glencore and Prodeco’s investments fairly and equitably. Glencore initiated a consultation process with the Columbian government in order to settle the dispute amicably…

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