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BHP September quarter copper production update

Metal News - Published on Thu, 18 Oct 2018

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BHPB announced that its total copper production for the September 2018 quarter was broadly flat at 409 kt. Guidance for the 2019 financial year has been reduced to between 1,620 and 1,705 kt and reflects lower volumes at Spence and Olympic Dam.

Escondida copper production increased by 10 per cent to 295 kt driven by higher copper concentrate output. This is a result of the diversion of ore feed from sulphide leach to the three concentrators to maximise their utilisation, which offset the impact of expected lower copper grades and adverse weather conditions in the quarter. Guidance remains unchanged at between 1,120 and 1,180 kt in the 2019 financial year. During the period, we successfully completed negotiations with Escondida Union N°1 and signed a new collective agreement, effective for 36 months from 1 August 2018.

Pampa Norte copper production decreased by 25 per cent to 43 kt as a result of lower volumes from Spence. The decrease reflected a lower stacking rate in May and June 2018 as a result of planned maintenance, and a production outage following a fire at the electro-winning plant in September 2018. Production guidance for Spence has been reduced from between 185 and 200 kt to between 160 and 175 kt, with volumes weighted to the second half as a return to full capacity is expected during the December 2018 quarter. Since the fire, mining and stacking operations at Spence have continued, accumulating copper in the system, which will be recovered over the coming years as tankhouse capacity becomes available. On 19 June 2018, BHP entered into an agreement to sell Cerro Colorado to EMR Capital*3*. The transaction is expected to close during the December 2018 quarter, subject to financing and customary closing conditions. During the period, we successfully completed the advanced negotiation with Cerro Colorado Union N°1 (operators and maintenance), with the new agreement effective for 36 months from 1 September 2018.

Olympic Dam copper production decreased by 21 per cent to 33 kt as a result of an unplanned acid plant outage in August 2018. Surface operations remain suspended as remediation works continue on the gas converter, sulphur burner and waste heat boiler in the acid plant. Surface operations are expected to recommence at the end of October 2018 and ramp up to full capacity during November 2018. As a result, production guidance for the 2019 financial year has been reduced from between 200 and 220 kt to between 170 and 180 kt. Underground operations have been unaffected with total development of nine kilometres achieved in the September 2018 quarter and progression into the higher ore grade Southern Mine Area continuing.

Antamina copper production increased by three per cent to 37 kt due to higher head grades. Production guidance for the 2019 financial year remains unchanged at approximately 135 kt for copper and approximately 85 kt for zinc.

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Posted By : Rabi Wangkhem on Thu, 18 Oct 2018
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