Return to news listing NEWS RELEASE - 22.04.20

Quarterly Production Report - Q1 2020


Antofagasta plc CEO, Iván Arriagada said: “Antofagasta´s top priority has always been the safety and health of our workforce and communities. Since the outbreak of COVID-19 we have implemented multiple measures to prevent the spread of infection across our operations and launched a $6 million fund to support the communities we work in. We are also working alongside government to deliver a coordinated response and we review the situation daily to ensure we are responding effectively to health, operational and financial concerns. We are committed to operating safely, providing employment, supporting our suppliers and contributing to the economic and social recovery of Chile.  

“Although we are currently operating with about two-thirds of our workforce on-site in line with our preventative health measures, this has so far had a limited impact on production. Indeed, in Q1 2020 copper production was 194,000 tonnes, 4.6% higher than in the previous quarter, and net cash costs were $1.10/lb, some 27c/lb lower because of the weaker Chilean peso, higher production and tighter cost control. We expect that for the foreseeable future we will need to maintain and continue to evolve the precautionary health measures we have adopted, including social distancing, revised personal protective equipment, increased teleworking and other health related changes. Because of these and other actions we have taken we now expect copper production to be towards the lower end of the original 725-755,000 tonnes guidance range, assuming our mining operations are not required to shut down temporarily.       

“Capital expenditure for the year is now expected to be less than $1.3 billion, that is at least $200 million lower than our original guidance of $1.5 billion due to the temporary suspension of the Los Pelambres Expansion project, the deferral of sustaining and other growth capital expenditure, lower mine development and a weaker Chilean peso.

“We have a solid balance sheet with $2.5 billion of cash which put us in a strong position to confront this unprecedented situation of operational uncertainty and lower copper price environment. We are expanding our Cost and Competitiveness Programme and continue to review all expenditure to preserve our financial strength while operating safely and efficiently.”



  • Copper production in Q1 2020 was 194,000 tonnes, an increase of 2.9% compared with the same quarter in 2019 and 4.6% higher than in Q4 2019
  • Gold production was 65,100 ounces in Q1 2020, 4.7% higher than in Q1 2019, mainly due to higher grades at Centinela
  • Molybdenum production was 2,400 tonnes, a decrease of 1,100 tonnes compared to the same period in 2019 due to lower grades at Los Pelambres, and 100 tonnes higher production than in Q4 2019


  • Cash costs before by-product credits in the quarter decreased by 11.2% to $1.51/lb from $1.70/lb in the same period last year and in Q4 2019 primarily because of the weaker Chilean peso, higher production and tighter cost control
  • Net cash costs were $1.10/lb in Q1 2020, compared to $1.24/lb in Q1 2019 and $1.37/lb in the previous quarter, reflecting the changes in cash costs before by-product credits


  • Multiple measures to prevent or slow the spread of infection have been implemented across the Group. These actions are intended to protect the health of the Company’s employees and contractors, and maintain a safe and healthy environment at the operations
  • A $6 million fund has been established to help the communities that live near Antofagasta´s mining operations in the province of Choapa and in the Antofagasta Region. This fund, in addition to existing social investment plans, will be used to buy medical supplies and equipment for healthcare workers to fight COVID-19, create facilities for people to stay if they need to be quarantined, and to sterilise public spaces and create safe areas for neighbouring communities
  • As announced on 6 April, the Los Pelambres Expansion project is currently suspended on a precautionary care and maintenance basis because of the health emergency caused by COVID-19. The suspension is expected to be for a maximum of 120 days and in most cases, will not lead to the early termination of contracts. During the suspension, contractors’ monthly salaries will be maintained at a level of at least the minimum set by the Group
  • During the current crisis, the Group is monitoring and assisting smaller and medium sized suppliers


  • Copper production, costs and capital expenditure guidance for 2020 is highly dependent on how the health emergency evolves over the coming months
  • Assuming mining operations continue to run at or close to capacity and no shutdowns are required, Group copper production in 2020 is expected to be at the lower end of the original 725-755,000 tonnes guidance range as the new health measures and lower manpower on-site have required mine movement and maintenance activities to be rescheduled, which will impact copper production during the rest of the year
  • Group net cash costs for the full year are expected to be $1.20/lb, 10c/lb lower than originally guided, assuming revised production guidance is achieved and the Chilean peso averages 800 pesos to the US dollar for the year
  • Capital expenditure in 2020 is expected to be less than $1.3 billion, a decrease on the $1.5 billion originally guided for 2020 with the temporary suspension of the Los Pelambres Expansion project, the deferral of sustaining and other development capital expenditure, lower mine development and a weaker Chilean peso
  • During the suspension of the Pelambres Expansion project some work is continuing on the desalination plant and the camp infrastructure. Additional critical activities are expected to be resumed progressively during the suspension period as government health protocols are revised with full resumption dependent on how the health emergency evolves. A revised project schedule and cost estimate is expected to be available once the suspension period concludes


  • As announced on 1 April, Centinela has signed a 100% renewable energy contract which will be effective from 2022 until 2033. This new power contract will be value accretive as power costs will be significantly reduced in stages from 2020 onwards. As part of the transaction Centinela will cancel two existing Power Purchase Agreements, that expire in 2026 and 2027, and the Company will sell its indirect 40% interest in the Hornitos thermal power station to ENGIE, resulting in an attributable post-tax write down of approximately $43 million, which will be recognised in Antofagasta´s half year financial results. With the completion of this agreement all the Group’s mines will use only renewable energy from 2022
  • As at the end of the period the Group’s total cash and liquid investments were $2.5 billion, some $300 million higher than at the end of 2019
  • As announced on 14 April, in view of the current compulsory UK Government’s Stay At Home Measures the Annual General Meeting will be a closed meeting held in the Company’s registered offices on 20 May 2020

Investors – London

Andrew Lindsay 

Andres Vergara 

Telephone +44 20 7808 0988   

Media – London

Carole Cable

Will Medvei

Telephone +44 20 7404 5959

Media – Santiago

Pablo Orozco 

Carolina Pica 

Telephone +56 2 2798 7000


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