ANTO Antofagasta Plc

By Jaime Llinares Taboada

Antofagasta PLC on Wednesday reported copper production for the third quarter and forecast lower output for next year, as drought conditions continue in Chile. Here's what the mining company had to say:

On 3Q production:

"Group copper production in Q3 2021 was 181,100 tonnes, 1.5% higher than in the previous quarter on higher production at Centinela, partly offset by lower throughput at Los Pelambres"

"Gold production for the quarter was 66,800 ounces, 8.8% higher than in the previous quarter, and for the year-to-date production rose by 25.4% to 187,300 ounces, both increases as a result of higher grades at Centinela"

"Molybdenum production in the quarter was 2,600 tonnes, 7.1% lower than the previous quarter on lower grades and recoveries at Centinela."

On costs:

"Cash costs before by-product credits in Q3 2021 were $1.79/lb, 2c/lb higher than in the second quarter."

"The global energy and supply chain crisis over Q3 resulted in higher commodity and therefore input prices, such as energy and diesel."

"However, evidence of wage inflation has been limited to temporary hires mostly for projects while the labour market has yet to recover to pre COVID-19 employment levels. The weaker Chilean peso in Q3 has offset the higher input costs."

"Our copper production and cost performance during the quarter was in line with our expectations despite external pressures such as the ongoing drought in Chile, the global supply chain challenges, the energy crisis and higher input costs."

On 2021 guidance:

"Copper production guidance for the full year of 710-740,000 tonnes is unchanged from the update provided in August. Net cash costs are expected to be below the originally guided $1.25/lb"

"Accelerated mine development at Centinela and sustaining capex at Los Pelambres have increased expected capital expenditure for the year to between $1.6 and $ 1.8 billion. This level is similar to current estimates for 2022 as sustaining and mine development expenditure increase, and development expenditure continues"

"In 2022 copper production is expected to be 660-690,000 tonnes, as grades decrease at Centinela Concentrates and assuming there is no precipitation until the next rainy season and the desalination plant comes into operation in H2 2022."

"Since we last reported, there has been no material rainfall at our operations and as we head into the summer months, we do not expect any rain until the next rainy season, which begins in June next year."

Write to Jaime Llinares Taboada at jaime.llinares@wsj.com; @JaimeLlinaresT

(END) Dow Jones Newswires

October 20, 2021 02:47 ET (06:47 GMT)

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