TIDMANTO
RNS Number : 5121U
Antofagasta PLC
25 October 2017
NEWS RELEASE, 25 OCTOBER, 2017
Q3 2017 PRODUCTION REPORT
Antofagasta plc CEO, Iván Arriagada said: "We have had a further
quarter of improved production with tonnages increasing by 3%
compared to the previous quarter and by 4.5% on a year to date
basis. Unit costs have kept flat, despite increased cost pressures,
with higher production at Centinela and Antucoya, and our continued
focus on improving efficiencies. With these savings achieved to
date we now expect our net cash costs to be below our original
guidance for the full year of $1.30/lb.
"In 2018 we plan to increase production to 705-740,000 tonnes of
copper as Encuentro Oxides ramps-up to full production."
HIGHLIGHTS
PRODUCTION
-- Group copper production in Q3 2017 was 180,200 tonnes, 3.3%
higher than in the previous quarter on increased production at Los
Pelambres.
-- Group copper production for the first nine months of the year
was 526,500 tonnes, 4.5% higher than in the same period last year.
This was primarily due to higher production at Centinela and
Antucoya.
-- Gold production during the quarter increased by 1.2% to
59,600 ounces and for the first nine months fell by 4.4% with lower
production at Centinela and Los Pelambres.
-- Molybdenum production at Los Pelambres increased in Q3 2017
to 2,700 tonnes and for the year to date was 38.5% higher than in
the same period last year, due to higher molybdenum grades.
CASH COSTS
-- Cash costs before by-product credits in Q3 2017 were
$1.56/lb, 1.3% higher than in Q2 2017 as costs increased at
Centinela after a strong performance in the previous quarter.
-- Cash costs before by-product credits for the first nine
months were $1.56/lb, 1.3% better than last year due to higher
production and cost savings achieved from the Cost and
Competitiveness Programme.
-- Net cash costs were $1.18/lb in Q3 2017, a 1.7% improvement
compared with the previous quarter, as the higher cash costs before
by-product credits were offset by increased by-product volumes and
realised prices.
-- Net cash costs for the first nine months were $1.22/lb, 0.8%
better than in the same period last year.
GUIDANCE
-- Copper production guidance for 2017 remains unchanged at
685-720,000 tonnes, and production is expected to increase to
705-740,000 tonnes in 2018.
-- Cash costs before by-product credits guidance for the full
year is unchanged at $1.55/lb and net cash costs are now expected
to be lower than the $1.30/lb guided at the beginning of the year
reflecting stronger than expected by-product revenue.
-- Total capital expenditure for the year is expected to be
approximately $900 million, as previously guided.
OTHER
-- Successfully concluded labour negotiations at Zaldívar during the quarter.
-- Labour negotiations have commenced at Los Pelambres and are
expected to be concluded before the deadline in February 2018.
GROUP PRODUCTION AND Year to Date Q3 Q2
CASH COSTS
------------------------------- ---------------------- ------ ------ ------
2017 2016 % 2017 2017 %
----------------------- ------ ------ ------ ------ ------ ------ ------
Copper production(1) kt 526.5 503.9 4.5 180.2 174.4 3.3
Copper sales kt 522.4 491.7 6.2 188.3 158.4 18.9
Gold production koz 171.8 179.7 (4.4) 59.6 58.9 1.2
Molybdenum production kt 7.2 5.2 38.5 2.7 2.4 12.5
----------------------- ------ ------ ------ ------ ------ ------ ------
Cash costs before
by-product credits $/lb 1.56 1.58 (1.3) 1.56 1.54 1.3
Net cash costs $/lb 1.22 1.23 (0.8) 1.18 1.20 (1.7)
----------------------- ------ ------ ------ ------ ------ ------ ------
(1) Includes pre-commercial production at Antucoya of 12,700
tonnes in 2016, which are not included in unit cost
calculations.
Investors Media - London
- London
Andrew alindsay@antofagasta.co.uk Carole antofagasta@brunswickgroup.com
Lindsay Cable
Paresh pbhanderi@antofagasta.co.uk Will antofagasta@brunswickgroup.com
Bhanderi Medvei
+44 20 7808
Telephone 0988 Telephone +44 20 7404 5959
Investors - Santiago Media - Santiago
Francisco fveloso@aminerals.cl Pablo porozco@aminerals.cl
Veloso Orozco
Carolina cpica@aminerals.cl
Pica
Telephone +56 2 2798 7000 Telephone +56 2 2798 7000
MINING OPERATIONS
Los Pelambres
Los Pelambres produced 86,800 tonnes of copper in Q3 2017, 6.6%
higher than in the previous quarter as higher throughput was
achieved due to softer ore and slightly higher grades. In the first
nine months of 2017, copper production decreased slightly by 3.2%
to 251,000 tonnes, compared with the same period last year. This
decrease was primarily due to lower grades, despite increased
throughput.
Sales of copper were 95,400 tonnes in Q3 2017, higher than
production, as the stocks accumulated at the port as a result of
poor sea conditions at the end of the previous quarter were
shipped.
Molybdenum production was higher at 2,700 tonnes in Q3 2017
compared to the previous quarter, as the grade improved although
recoveries fell. Production for the first nine months of the year
was 7,200 tonnes, which was 38.5% higher than in the comparable
period in 2016 as a result of higher grade.
Cash costs before by-product credits in Q3 2017 were $1.46/lb,
compared with $1.50/lb in the previous quarter. This decrease was
principally due to higher production, the reduced use of
consumables and the continuation of the Cost and Competitiveness
Programme. For the first nine months of the year, cash costs before
by-product credits were $1.45/lb, 6.6% higher than in 2016
primarily due to lower production and higher consumables'
prices.
Net cash costs during the quarter were $1.01/lb, 10.6% lower
than in the previous quarter as a result of higher by-product
production and realised prices. Net cash costs for the first nine
months of the year were $1.06/lb, 1.9% higher than the same period
last year as increased by-product credits were insufficient to
offset the rise in cash costs before by-products.
LOS PELAMBRES Year to Date Q3 Q2
------------------------
2017 2016 % 2017 2017 %
------------------------ ------ ------ ------ ------- ------ ------ -------
Daily ore throughput kt 159.3 153.8 3.6 161.3 155.6 3.7
Copper grade % 0.67 0.70 (4.3) 0.68 0.67 1.5
Copper recovery % 89.0 89.1 (0.1) 89.5 89.9 (0.4)
Copper production kt 251.0 259.3 (3.2) 86.8 81.4 6.6
Copper sales kt 245.6 254.2 (3.4) 95.4 67.5 41.3
------------------------ ------ ------ ------ ------- ------ ------ -------
Molybdenum grade % 0.021 0.016 31.3 0.022 0.021 4.8
Molybdenum recovery % 79.2 78.6 0.8 80.9 81.9 (1.2)
Molybdenum production kt 7.2 5.2 38.5 2.7 2.4 12.5
Molybdenum sales kt 7.3 5.4 35.2 2.9 2.3 26.1
Gold production koz 40.1 43.1 (7.0) 13.3 12.9 3.1
Gold sales koz 38.4 47.1 (18.5) 14.4 10.4 38.5
------------------------ ------ ------ ------ ------- ------ ------ -------
Cash costs before
by-product credits(1) $/lb 1.45 1.36 6.6 1.46 1.50 (2.7)
Net cash costs(1) $/lb 1.06 1.04 1.9 1.01 1.13 (10.6)
------------------------ ------ ------ ------ ------- ------ ------ -------
(1) Includes tolling charges of $0.25/lb in Q3 2017, $0.26/lb in
Q2 2017, $0.26/lb YTD 2017 and $0.27/lb YTD 2016
Centinela
Total copper production at Centinela was 60,600 tonnes in Q3
2017, 1.0% lower than in the previous quarter due to lower
production of copper cathodes, and copper in concentrates flat
across the quarters. Total production for the first nine months of
the year 2017 was 10.7% higher than in 2016 primarily as a result
of higher grades.
Production of copper in concentrates was 47,300 tonnes in Q3
2017, unchanged compared with the previous quarter as higher grades
and higher recoveries were offset by lower throughput as a result
of harder ore, and scheduled maintenance during the quarter.
Copper in concentrate production for the first nine months of
the year was 10.5% higher than in the same period last year mainly
reflecting higher grades.
Production of copper cathodes for the quarter was 13,300 tonnes,
a 4.3% decrease from the previous quarter due to lower grades and
recoveries which were slightly offset by higher throughput. For the
first nine months of the year cathode production rose 10.9% to
43,600 tonnes as a result of higher grades and throughput offset
slightly by lower recoveries.
Gold production in the quarter was 46,300 ounces as a result of
higher grades and recoveries. During the first nine months of the
year gold production was 3.5% lower than the same period last year
due to lower recoveries.
Cash costs before by-product credits were $1.67/lb in the
quarter, an increase of 7.1% compared to the previous quarter as
spare parts and maintenance costs were higher as a result of the
scheduled major maintenance in the quarter. In addition, a new
labour agreement was reached with the supervisors' union during the
quarter which increased cash costs by a one-off amount of 3.5 c/lb
in the quarter and 1 c/lb for the full year. Cash costs before
by-product credits for the first nine months of 2017 were 11.6%
lower than in 2016 with higher copper production and cost savings
from the Cost and Competitiveness Programme.
Net cash costs in Q3 2017 were $1.18/lb, 9.3% higher than in the
previous quarter as higher gold prices were not able to offset the
increase in cash costs before by-products. In the first nine months
of the year, net cash costs were down 11.9% at $1.19/lb due to
higher gold sales offset by a slightly lower realised gold
price.
CENTINELA Year to Date Q3 Q2
2017 2016 % 2017 2017 %
------------------------- ------ ------ ------ ------- ----- ----- -------
CONCENTRATES
------ ------ ------ ------- -----
Daily ore throughput kt 89.1 90.9 (2.0) 85.8 92.2 (6.9)
Copper grade % 0.65 0.57 14.0 0.70 0.67 4.5
Copper recovery % 87.2 87.2 - 88.4 88.0 0.5
Copper production kt 133.6 120.9 10.5 47.3 47.3 -
Copper sales kt 139.5 115.2 21.1 49.8 45.8 8.7
------------------------- ------ ------ ------ ------- ----- ----- -------
Gold grade g/t 0.25 0.24 4.2 0.26 0.25 4.0
Gold recovery % 71.1 72.7 (2.2) 72.2 70.3 2.7
Gold production koz 131.8 136.6 (3.5) 46.3 46.0 0.7
Gold sales koz 139.3 133.3 4.5 48.8 45.0 8.4
------------------------- ------ ------ ------ ------- ----- ----- -------
CATHODES
------------------------- ------ ------ ------ ------- ----- ----- -------
Daily ore throughput kt 23.6 21.5 9.8 24.7 21.4 15.4
Copper grade % 0.93 0.78 19.2 0.90 0.95 (5.3)
Copper recovery % 66.3 69.8 (5.0) 58.7 65.5 (10.4)
Copper production
- heap leach kt 38.9 33.1 17.5 11.8 12.2 (3.3)
Copper production
- total((1) kt 43.6 39.3 10.9 13.3 13.9 (4.3)
Copper sales kt 43.3 38.4 12.8 12.7 14.6 (13.0)
Total copper production kt 177.3 160.2 10.7 60.6 61.2 (1.0)
------------------------- ------ ------ ------ ------- ----- ----- -------
Cash costs before
by-product credits(2) $/lb 1.67 1.89 (11.6) 1.67 1.56 7.1
------------------------- ------ ------ ------ ------- ----- ----- -------
Net cash costs(2) $/lb 1.19 1.35 (11.9) 1.18 1.08 9.3
------------------------- ------ ------ ------ ------- ----- ----- -------
(1) Includes production from ROM material
(2) Includes tolling charges of $0.19/lb in Q3 2017, $0.20/lb in
Q2 2017, $0.20/lb YTD 2017 and $0.22/lb YTD 2016
Antucoya
Copper production at Antucoya was 19,800 tonnes in Q3 2017, 3.1%
higher than in the previous quarter as slightly improved grades
were partly offset by lower recoveries. Compared to last year,
production in the first nine months of 2017 was 28.0% higher than
in the same period last year as significantly higher throughput and
higher recoveries were only slightly offset by a decline in
grade.
During the quarter the cash costs were $1.67/lb, almost
unchanged compared to Q2 2017. For the first nine months cash costs
were down by 2.3% to $1.70/lb compared to the same period last
year.
ANTUCOYA Year to Date Q3 Q2
2017 2016 % 2017 2017 %
---------------------- ------ ----- ----- ------ ----- ----- ------
Daily ore throughput kt 78.2 62.8 24.5 79.7 79.1 0.8
Copper grade % 0.37 0.40 (7.5) 0.37 0.36 2.8
Copper recovery % 73.9 70.3 5.1 71.2 74.5 (4.4)
Copper production kt 59.4 46.4 28.0 19.8 19.2 3.1
Copper sales kt 57.4 45.5 26.2 18.1 19.1 (5.2)
---------------------- ------ ----- ----- ------ ----- ----- ------
Cash costs(1) $/lb 1.70 1.74 (2.3) 1.67 1.66 0.6
---------------------- ------ ----- ----- ------ ----- ----- ------
(1) Cash costs from Q2 2016 onwards following commercial
production being reached on 1 April 2016
Zaldívar
Production for the quarter was 2.4% higher than in Q2 2017 at
12,900 tonnes. Throughput for the quarter fell compared to the
previous quarter to close to the year-to-date average while the
grade of the ore placed on the heap increased slightly. Copper
production in the first nine months of the year was 38,800 tonnes,
some 2.1% higher than in the same period last year, on higher grade
and despite lower recoveries. Recoveries have decreased this year
as a result of the significantly higher proportion of sulphide ores
being processed, compared to 2016.
Cash costs increased by 1.3% to $1.57/lb in Q3 2017 compared to
the previous quarter due to upgrading work on the stacking system
and water pipeline. During the quarter a three-year labour
agreement was successfully concluded with the union, increasing
cash costs by 1c/lb. Cash costs for the first nine months of 2017
were $1.59/lb, almost unchanged compared with the same period in
2016.
ZALDÍVAR Year to Date Q3 Q2
2017 2016 % 2017 2017 %
---------------------- ------ ----- ----- ------ ----- ----- -------
Daily ore throughput kt 47.7 46.5 2.6 47.3 53.6 (11.8)
Copper grade % 0.79 0.60 31.7 0.77 0.76 1.3
Copper recovery(1) % 60.9 67.5 (9.8) 58.9 59.4 (0.8)
Copper production
- heap leach(2) kt 28.6 26.7 7.1 9.3 9.1 2.2
Copper production
- total(2,3) kt 38.8 38.0 2.1 12.9 12.6 2.4
Copper sales(2) kt 36.6 37.5 (2.4) 12.4 11.4 8.8
---------------------- ------ ----- ----- ------ ----- ----- -------
Cash costs $/lb 1.59 1.58 0.6 1.57 1.55 1.3
---------------------- ------ ----- ----- ------ ----- ----- -------
(1) Average over full leach cycle
(2) Group's 50% share
(3) Includes production from secondary leaching
Transport
The total tonnage transported by the Division in Q3 2017
increased by 7.2% to 1.7 million tonnes as lower copper tonnages
were offset by higher acid volumes, although tonnes transported for
the year to date are still lower than in the same period last year
following the disruptions at two of its customers in the first
quarter.
TRANSPORT Year to Date Q3 Q2
2017 2016 % 2017 2017 %
--------------------------- ---- ------- ------- ------ ------- ------- ----
Rail Kt 3,732 4,043 (7.7) 1,337 1,250 7.0
Road kt 895 907 (1.2) 320 296 8.0
--------------------------- ---- ------- ------- ------ ------- ------- ----
Total tonnage transported kt 4,628 4,949 (6.5) 1,657 1,547 7.2
--------------------------- ---- ------- ------- ------ ------- ------- ----
Commodity prices and exchange rates
PRICES AND EXCHANGE Year to Date Q3 Q2
RATES
2017 2016 % 2017 2017 %
--------------------- ------ ------ ------ ------ ------ ------ ------
Copper
-----------------------------------------------------------------------------
Market price $/lb 2.70 2.14 25.9 2.88 2.57 12.1
Realised price $/lb 2.85 2.18 30.8 3.09 2.61 18.6
--------------------- ------ ------ ------ ------ ------ ------ ------
Gold
-----------------------------------------------------------------------------
Market price $/oz 1,252 1,258 (0.5) 1,278 1,257 1.6
Realised price $/oz 1,281 1,300 (1.6) 1,295 1,267 2.2
--------------------- ------ ------ ------ ------ ------ ------ ------
Molybdenum
-----------------------------------------------------------------------------
Market price $/lb 8.0 6.4 24.5 8.1 8.1 0.5
Realised price $/lb 8.6 7.3 18.5 9.6 7.7 24.9
--------------------- ------ ------ ------ ------ ------ ------ ------
Exchange rates
-----------------------------------------------------------------------------
per
Chilean peso $ 654 681 (3.9) 643 664 (3.2)
--------------------- ------ ------ ------ ------ ------ ------ ------
The spot commodity prices for copper, gold and molybdenum as at
30 September 2017 were $2.92/lb, $1,280/oz and $7.09/lb
respectively compared with $2.69/lb, $1,242/oz and $7.12/lb as at
30 June 2017 and $2.20/lb, $1,316/oz and $6.71/lb as at 30
September 2016.
The provisional pricing adjustments for copper, gold and
molybdenum for the quarter were positive $96.3 million, $0.2
million and $10.4 million respectively.
The provisional pricing adjustments for copper, gold and
molybdenum for the first nine months of the year were positive
$173.6 million, $0.2 million and $9.3 million respectively.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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