Antofagasta Expects Billion Dollar Capex in 2018 -- Commodity Comment
25 January 2018 - 3:38AM
Dow Jones News
By David Hodari
Copper mining giant Antofagasta PLC released its 4Q 2017
production report on Wednesday. Here are remarks from the company's
report:
On 2017...
"Our disciplined approach to capital allocation has allowed the
Group to continue to invest in profitable tonnes throughout the
cycle. The new additions to our portfolio at Zaldivar, Antucoya and
Encuentro Oxides now account for 25% of Group production, helping
offset declines at our mature assets and providing Antofagasta with
a platform for growth as copper prices recover."
On copper production...
"Copper production in Q4 was 1.3% less than in the previous
quarter. Higher production at Los Pelambres and the ramp-up of the
Encuentro Oxides project offset lower production at Centinela
Concentrates... copper production for the full year was... in line
with guidance and 0.7% lower than in 2016."
On gold production...
Gold production... [decreased] 32.0% on Q3 2017 due to lower
grades and recoveries at Centinela. For the full year production
was... 21.6% lower than in 2016..."
On molybdenum production...
"Molybdenum production at Los Pelambres was 3,300 tonnes in Q4
2017 and 10,500 tonnes for the full year, 47.9% higher than in the
previous year on higher grades."
On 2018 capital expenditure guidance...
"Capital expenditure in 2018 is expected to be $1.0 billion,
including expenditure on the Los Pelambres Incremental Expansion
project, which will add 55,000 tonnes of copper per annum once in
full operation... start-up is expected in 2021. Sustaining capital
expenditure increases in 2018 due to the concentration of mine
equipment replacement and tailings dam expenditure."
On its mine at Los Pelambres...
"Los Pelambres produced 92,800 tonnes of copper in Q4 2017
compared with 86,800 tonnes in the previous quarter. This increase
is mainly... following the completion of maintenance at the end of
Q3 2017. As guided, production for the year decreased by 3.3%...due
to lower grades. Cash costs before by-product credits fell in Q4
2017... principally a result of... higher utilisation rates, softer
ore and slightly higher grades. For the full year, cash costs
before by-product credits were 5.9% higher than in 2016..."
On its mine at Centinela...
"...copper production was 15.8% lower than Q3 2017 following a
significant decrease in grades... Total production for the full
year was 3.3% lower primarily as a result of lower recoveries...
partly offset by higher grades in the oxides line and the start of
production at Encuentro Oxides. Gold production was 45.6% lower
than in the previous quarter primarily due to decreased grades and
recovery. For the full year gold production was 26.3% lower than in
2016 mainly due to lower grades. [An] increase in cash costs was
mainly due to the payment of a one-off signing bonus following the
successful conclusion of the labour negotiations with the three
unions (increasing cash costs by 19c/lb) and lower production due
to lower sulphide grades."
On its mine at Zaldivar...
Copper production at Zaldivar was in line with the previous
quarter, as lower grades were offset by higher recoveries. For the
full year Zaldivar copper cathodes [production was] unchanged from
2016 as, although the grade increased, recoveries were lower due to
the significantly higher proportion of sulphide ores being
processed compared to 2016. Cash costs for 2017 were 5.2% higher
than previous year mainly because of the impact of the one-off
signing bonuses following the conclusion of the labour negotiations
and higher input prices."
Write to David Hodari at david.hodari@wsj.com
(END) Dow Jones Newswires
January 24, 2018 11:23 ET (16:23 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
Antofagasta (LSE:ANTO)
Historical Stock Chart
From Apr 2024 to May 2024
Antofagasta (LSE:ANTO)
Historical Stock Chart
From May 2023 to May 2024