Help Desk -
9958816305, 9810335381
Email
Password

Lundin Mining announces Q3 2018 results

Mining News - Published on Fri, 26 Oct 2018

Image Source: lundinmining.com
Lundin Mining Corporation reported cash flows of USD 140.9 million generated from operations in the third quarter of the year. Net earnings from continuing operations attributable to Lundin Mining shareholders were USD 7.0 million for the quarter. Marie Inkster, President and CEO commented, “Although the impact of reduced metal prices affected the quarter earnings, the underlying operational performance at the mines was excellent and enabled the generation of more than USD 140 million of operating cash flow. The reinvestment programs at Candelaria are advancing on plan and improvement in mining rates was achieved with good contractor performance management and ongoing delivery of new open pit equipment. Major underground and surface construction is underway on the Neves-Corvo Zinc Expansion Project, though overall progress continues to be impacted by contractor under-performance. Development of Eagle East continues to outperform and is on pace to produce first ore ahead of schedule and within budget in early 2020.”

Operational Performance
Total copper and nickel production are on target to achieve annual guidance. Zinc production for the year is expected to be within guidance, although the range has been lowered to reflect grades realized to date at Zinkgruvan. Planned lower grades at Candelaria led to lower copper production in the quarter compared to the third quarter of 2017. Neves-Corvo had another excellent quarter with year-to-date copper production already exceeding full year 2017 production. Work on projects at Candelaria and Eagle continued throughout the quarter with excellent progress achieved to date.

Candelaria (80% owned): The Candelaria operations produced, on a 100% basis, 35,323 tonnes of copper, and approximately 20,000 ounces of gold and 330,000 ounces of silver in concentrate during the quarter. Copper production in the quarter was lower than the prior year comparable period due to planned mining and processing of lower grade materials. Copper cash costs1 of $1.64/lb for the quarter were better than full year guidance, but higher than the prior year quarter. Lower metal production combined with higher diesel and labour costs contributed to the higher per unit production costs in the current quarter.

The Candelaria Mill Optimization Project progressed according to plan during the quarter with construction approximately 32% complete. Ramp-up of the Candelaria Underground North Sector continues to achieve excellent results, mining approximately 9,700 tonnes per day on average throughout the third quarter. All purchase orders for open pit mine fleet replacement equipment have been placed, and thirty eight of eighty five pieces of equipment have already arrived at site.

Eagle (100% owned): Eagle produced 4,697 tonnes of nickel and 5,178 tonnes of copper during the quarter, on track to achieve full year guidance. Nickel quantities were lower than the prior year while copper quantities were higher, both a result of planned mine sequencing. Nickel cash costs of $0.87/lb for the quarter were better than full year guidance but higher than the prior year comparable period as higher operating per unit costs were driven by lower sales volumes.

Development of the Eagle East access ramp continues ahead of schedule with first ore scheduled into the mill by 2020. Underground definition drilling from the access ramp in Eagle East is ongoing and 4,200 metres have been drilled to September 30, 2018.

Neves-Corvo (100% owned): Neves-Corvo produced 11,746 tonnes of copper and 18,905 tonnes of zinc for the quarter. Copper production in the quarter was higher than the prior year comparable period due to improved mine productivity and higher mill throughput driven by improvements in mine plan execution, and to a lesser extent, higher head grades. Zinc production was slightly lower (3%) than the prior year comparable period, as zinc head grades were negatively impacted by mine resequencing. Copper cash costs of $1.48/lb for the quarter were higher than full year guidance and the prior year period due to lower by-product credits, but were partly aided by lower per unit mine, mill, and administration costs associated with higher copper sales volumes.

Major surface and underground construction activities are underway on the Zinc Expansion Project (“ZEP”). Approximately 40% of major equipment deliveries have been received with all equipment expected to be received on schedule. Underground mechanical conveyor installation commenced during the quarter. The SAG mill building and flotation building concrete is advancing with SAG mill assembly beginning in October. Overall progress continues to be impacted by contractor under-performance, with the project now expected to commence production ramp-up in the first quarter of 2020. The total forecast cost of the project is currently €270 million, though the Company will be undertaking a third-party project schedule and cost review. Capital expenditure guidance for 2018 has been lowered to $110 million (from $130 million) to reflect the deferral of certain surface and underground expenditures to 2019.

Zinkgruvan (100% owned): Zinc production of 17,157 tonnes and lead production of 5,515 tonnes were lower than the prior year quarter driven by lower head grades as a result of mine sequencing and higher than planned dilution and ore loss. The operation is focused on mine stope design optimization and ore tracking in order to improve these factors. Zinc cash costs of $0.35/lb for the quarter were better than full year guidance, but higher than the prior year comparable quarter due primarily to higher per unit mine, mill and administration costs stemming from lower sales volumes.

Source :

Posted By : Rabi Wangkhem on Fri, 26 Oct 2018
Related News from Mining segment