MMG Limited today reports its fourth quarter 2016 production result with highlights including strong copper production at Las Bambas and record annual output at Kinsevere.
In the December quarter Las Bambas produced 105,491 tonnes of copper in copper concentrate and 330,227 tonnes for the full year 2016. The result exceeds the Company’s guidance range for the first year of operation of 250,000 to 300,000 tonnes.
Chief Executive Officer Andrew Michelmore said he was pleased with the operation’s result during this ramp up phase.
“Since achieving commercial production at Las Bambas on 1 July 2016, the operation has delivered two consecutive quarters of production above design capacity.
“While concentrate transport through local communities continues to be a challenge, we are committed to working in partnership with government and communities to drive development and dialogue.
“The progress to date has been outstanding and the transition to steady state operations will continue into 2017, with the team at Las Bambas focused on optimising production and reducing costs,” he said.
Fourth Quarter and Full Year 2016 Highlights
MMG operations produced 503,510 tonnes of copper in 2016, exceeding the guidance range of 415,000-477,000 tonnes. The Company produced 119,575 tonnes of zinc, slightly below its guidance range of 120,000-135,000 as the production profile shifted from zinc to copper in 2016.
In addition to the strong result at Las Bambas, MMG’s Kinsevere operation delivered a record year on safety, volume and cost measures.
“The production result of 80,650 tonnes of copper cathode for the full year represents the third consecutive annual production record at Kinsevere. The operation continues to deliver outstanding results above nameplate capacity as we successfully squeeze production and efficiencies from this asset,” Mr Michelmore said.
Sepon produced 22,527 tonnes of copper cathode during the December quarter which represents a 12% increase on the previous quarter. The result is the strongest quarterly production in 2016 despite the operation’s ongoing transition to lower grade, more complex ores.
Production at Rosebery was 7% higher in the fourth quarter when compared to the September quarter due to higher feed grades and improved recoveries.
Golden Grove also delivered strong production in the December quarter with zinc 134% higher and copper 116% higher when compared to the previous quarter. The improvement is attributable to increased mining rates for zinc and increased copper feed grades.
Development of Dugald River, which is expected to be one of the world’s top ten zinc mines when operational, continues to advance with over 45% of the project now completed. The commissioning of Dugald River remains on target with production of concentrate expected in the first half of 2018.
“This has been a very successful year at Las Bambas, as well as at our other operations. We continue to earn our right to grow and we maintain our commitment to build the world’s most respected diversified base metals company,” Mr Michelmore concluded.
“While market conditions were tough in 2016 we ended the year heading in the right direction with the copper and zinc price improving. We also completed a very successful capital raise which demonstrates that there is significant investor interest in being part of the MMG story,” he said.
2017 Production Guidance
MMG expects to produce 560,000-615,000 tonnes of copper and 65,000-72,000 tonnes of zinc in 2017. The guidance range excludes the Golden Grove operation following the announcement on 30 December 2016 that MMG has entered into a conditional sale agreement of Golden Grove to EMR Capital.
Please download a full copy of the MMG Fourth Quarter 2016 Production Report.