Quarterly Production Report - Q1 2018
Q1 2018 PRODUCTION REPORT
Antofagasta plc CEO Iván Arriagada said: “As planned and in line with budget the year has started with lower grades at our operations. During the quarter, we have also successfully concluded the labour negotiations at Los Pelambres.
“First quarter copper production was 153,800 tonnes and will increase quarter-on-quarter as grades improve during the year and into 2019. For the full year our production guidance is unchanged at 705-740,000 tonnes.
“Net cash costs were $1.54/lb, reflecting the lower grades experienced in the quarter and a stronger Chilean Peso, but with grades increasing during the year and improved by-product performance, costs will reduce and so guidance for the full year is unchanged at $1.35/lb.”
- As expected, copper production in Q1 2018 decreased by 10.5% to 153,800 tonnes compared with the same quarter in 2017 mainly due to the anticipated lower grades
- Gold production was 32,300 ounces in Q1 2018, 39.4% lower than in Q1 2017 and 20.4% lower than in the previous quarter as grades were down at Centinela
- Molybdenum production increased by 40.9% compared to the same period in 2017 due to better grades and recoveries
- Cash costs before by-product credits in the quarter increased to $2.00/lb from $1.59 /lb in the same period of last year primarily because of lower production and a stronger Chilean Peso
- Net cash costs were $1.54/lb in Q1 2018, compared to $1.27 /lb in Q1 2017 and $1.36 /lb in the previous quarter, reflecting the changes in cash costs before by-product credits, partially offset by higher by-product credits arising from higher molybdenum production and a significant increase in the realised molybdenum price
- Guidance for the year is unchanged. Group copper production for the full year is expected to be 705-740,000 tonnes, with production increasing quarter-by-quarter during the year as grades improve at the operations to achieve guided grades for the full year
- Net cash costs guidance of $1.35/lb is also unchanged, assuming no further strengthening in the Chilean Peso during the balance of the year
- In February this year, Los Pelambres successfully completed labour negotiations with the plant union and in March with the mine union. The one-off signing bonuses related to these three-year agreements increased Los Pelambres’ cash costs by 8c/lb and Group cash costs by 4c/lb for the quarter, equivalent to 2c/lb and 1c/lb on an annual basis. These negotiation’s conclude the Group’s scheduled negotiations for the year
|GROUP PRODUCTION AND CASH COSTS||Year to Date||Q1||Q4|
|Cash costs before by-product credits (1)||$/lb||2.00||1.59||25.8||2.00||1.69||18.3|
|Net cash costs (1)||$/lb||1.54||1.27||21.3||1.54||1.36||13.2|
(1) Cash cost is a non-GAAP measure used by the mining industry to express the cost of production in US dollars per pound of copper produced.
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