MMG on track to deliver annual copper and zinc guidance

22 Jul 2013 08:40 AMMedia Release

MMG Limited (MMG) announced its second quarter production report today highlighting the company is on track to deliver annual production guidance of 170,000–185,000 tonnes of copper and 572,000–590,000 tonnes of zinc in 2013.

MMG produced a total of 89,235 tonnes of copper in the first half 2013, 33% higher than the previous year.

Chief Executive Officer Andrew Michelmore said, “the increase in first half copper production is due to productivity improvements at Sepon, the ramp-up of Kinsevere and the commissioning of our copper oxide open pit at Golden Grove.”

“Sepon has transitioned to an owner-operator mine. This means all mining activity at Sepon is now undertaken by MMG employees enabling us to directly and efficiently manage safety, volume and costs. This has contributed to the productivity improvements we are seeing today,” said Mr Michelmore.

Kinsevere also exceeded original designed nameplate capacity on annualised basis in the second quarter, highlighting efficiencies identified since nameplate capacity was first achieved in December 2012.

“Kinsevere produced 15,858 tonnes of copper cathode during the quarter, representing a 14% increase on the previous quarter and 56% increase on the second quarter 2012 due to higher throughput and a stable electricity supply enabled by the use of diesel generators,” he said.

MMG produced a total of 280,968 tonnes of zinc in zinc concentrate in the first half 2013, a 16% decrease compared to the same period in 2012. A strong performance at Rosebery was more than offset by lower production at Century, where lower ore grade impacted production.

Dugald River project

During the second quarter, MMG entered into a facility agreement of up to US$1 billion to finance the development and construction of the Dugald River project.

“Our Dugald River deposit is a long life, world class ore body with unique geological characteristics,” said Mr Michelmore.

“We continue to progress pre-approval project activity with development of the underground declines progressing ahead of schedule.”

With total underground development now in excess of 8,000 metres and underground drilling and geotechnical work well underway, complexities in the ore body have been identified prompting a review of the planned mining method, optimum production volumes and associated above ground processing facilities. This review is expected to be completed by the end of 2013.

MMG will conduct a production scale processing test of Dugald River ore by transporting and processing approximately 100,000 tonnes at MMG’s Century operation in the fourth quarter. The test will enable MMG to optimise the mine plan and construction design of the Dugald River project.

The Board of MMG will consider the review and results from trial ore processing in making a final investment decision regarding the development of the Dugald River project.

A revised project plan may result in changes to the previously advised schedule and budget for the project.

MMG will release its Financial Results for the half year ended 30 June 2013 on 28 August 2013.

For further information please refer to the full MMG Limited Second Quarter Production Report 2013.

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