MMG Limited (MMG) (1208.HK) today released its fourth quarter production results reporting a solid operating performance at all sites and achieving annual copper production records for 2014.
MMG CEO Andrew Michelmore said, “Today’s result highlights the dedication and talent of our people, and our ability to deliver on guidance while improving safety performance.”
MMG produced a total of 191,307 tonnes of copper in 2014, exceeding annual guidance of 175,000–187,000 tonnes. This annual record was achieved following a strong fourth quarter at both Sepon and Kinsevere, supported by consistent results from Golden Grove and Rosebery.
“The ongoing commitment to operational excellence and improvement continues to support the outstanding results delivered by Sepon and Kinsevere,” said Mr Michelmore. “This work contributed to the quarterly records achieved at both sites in the fourth quarter 2014.”
Sepon produced 24,055 tonnes of copper cathode in the fourth quarter, 11% higher than the previous quarter due to record tonnes milled and improved grade.
Kinsevere achieved full year production of 69,624 tonnes of copper cathode, 12% higher than in 2013 driven by an ongoing focus on asset utilisation and efficiency.
Total annual zinc production of 587,099 tonnes was also within guidance following a strong fourth quarter at Century and Golden Grove.
Golden Grove produced a total of 37,896 tonnes of zinc concentrate in 2014, 60% higher than 2013 due to higher throughput and increased zinc feed grades.
Century produced a total of 465,696 tonnes of zinc in zinc concentrate with strong fourth quarter production offsetting lower production in the third quarter due to the dry docking of Century’s concentrate transfer vessel.
“As we prepare for the end of open pit zinc production at Century this year, we continue to study future options to use the operation’s infrastructure as part of the wider Queensland Operations strategy,” said Mr Michelmore.
“We also continued rehabilitation activities including the distribution of native tree seeds by helicopter intended to transform the existing waste rock dumps into landforms that complement the surrounding environment,” he said.
MMG also reported its cost performance with all sites delivering C1 costs within annual guidance.
Mr Michelmore said, “MMG’s solid performance in 2014 clearly demonstrates the way in which we operate our assets and our commitment to ‘do what we say’.”
“Despite the challenges ahead including the end of production at Century and declining ore grades at Sepon, our team is committed to maintaining strong production output in 2015,” he said.
MMG has provided annual production and cost guidance throughout the report and expects to produce 166,000–181,000 tonnes of copper and 440,000–510,000 tonnes of zinc this year.
Construction of the Las Bambas project continued in the fourth quarter 2014 with the main activity focusing on the construction of the processing plant, primary crusher, overland conveyor and key surface infrastructure, along with the design of concentrate logistics. As at 31 December 2014, the overall project was 80% complete.
Mr Michelmore said, “We are pleased to report that development of the Las Bambas project is tracking well and is now 80% complete.
“We have been working very closely with the local community to ensure a smooth transition as families continue to relocate to the new Fuerabamba town,” he said.
Approximately three quarters of families have now relocated with the relocation expected to be largely complete in the first quarter 2015. This has no impact to project construction.
Pre-stripping activity will commence in the first quarter 2015 to enable the commencement of mining in the Ferrobamba pit.
MMG completed its trial stoping program at Dugald River in 2014 with a total of 19 stopes successfully mined.
“The Dugald River trial stoping program has been critical in expanding MMG’s understanding of the geotechnical conditions of the mine and optimal mining strategy,” said Mr Michelmore.
The results of the trial continue to be analysed in parallel with a review of surface infrastructure and processing requirements.
As a result of the trial stoping program, there are ore stockpiles at Dugald River of approximately 450,000 tonnes with an average grade of 13.3% zinc. Trucking this stockpiled ore to Century for processing is one of a number of options being considered in the short term while the analysis of the trial stoping program is underway.
1As at 31 December 2014.
Image: Native tree seeds have been distributed by helicopter as part of the rehabilitation of Century to eventually transform the area into landforms that complement the surrounding environment.
Image: Local community members gather at the opening of a new school at the new Fuerabamba town near the Las Bambas project in Peru.
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