Antofagasta Plc
Antofagasta Plc
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Like an Olympic swimmer aiming for a negative split, Antofagasta is relying on a strong second half to reach its full year production forecast after producing 323,300t copper in the 6 months to June. Even with production weighted to the second half, the Chilean copper giant expects to finish at the lower end of its 710,000-740,000t guidance for FY2016.
However, CEO Iván Arriagada says its focus on cost control, productivity and operational efficiencies improved H1 net cash costs by 17.6% to $US1.26/lb, building Antofagasta's confidence of meeting its revised target of $1.30/lb.
Signs of stability are emerging in the copper market but new Antofagasta chief Iván Arriagada suggests prices will remain subdued in the short term.
The first full quarter of production from Zaldivar and increases at Antucoya helped lift Chilean copper giant Antofagasta's production for the March qtr (Q1) to 157,100t, 7.3% higher than Q1FY2015 despite declining grades at Centinela Cathodes and the closure of Michilla. Net cash costs improved 4% to $US1.37/lb.
CEO Iván Arriagada says guidance for the year remains unchanged at 710.000-740,000t at net cash cost of $1.35/lb. He says recent movements in the copper price may suggest the market is beginning to stabilise but prices are likely to remain subdued in the near term.
Chilean copper giant Antofagasta has named former Codelco and BHP Billiton executive Iván Arriagada as CEO following the retirement of Diego Hernández. The handover takes place immediately, although Hernández will stay on as an adviser.
Arriagada has been CEO of Antofagasta Minerals since Feb 2015, leading management integration and cost reduction programs.
Chilean copper giant Antofagasta has sustained a 66% fall in cash flow from operations to $US858.3M for the year to Dec 2015, down from $2.5B in FY2014. Revenue dropped 34% to $3.39B on copper sales that declined 9.5% to 653,900t and lower prices.
Antofagasta expects 2016 production to grow to 710,000-740,000t copper, 245,000-275,000oz gold and 8,000-9,000t molybdenum while the copper price stabilises.
Chilean miner Antofagasta is expecting a brighter 2016 after operational setbacks in FY/CY2015 saw copper production slump 10.6% on 2014 to 630,300t and gold down 56,000oz to 213,900oz.
Antofagasta is expecting big 2016 copper-gold increases after 2015 falls
Barrick Gold has completed the $US1B sale of 50% of its Zaldívar Copper Mine in Chile to Antofagasta to further reduce debt.
After starting FY/CY2015 with $13.1B debt, Barrick has announced asset sales, J/Vs and partnerships worth $3.2B since the start of 2015 and is on track to meet its debt reduction target of $3B for 2015.
Losing Antofagasta as its exploration partner at the Lumwana West copper project in Zambia plus persistently low copper prices have forced Argonaut to review its strategic focus on large copper targets.
While keeping a watching brief on Zambian opportunities, and remaining committed to the potentially enormous Torrens JV with Straits Resources in South Australia, chairman Patrick Elliott told the AGM Argonaut will also seek commodities that have a more robust long-term demand outlook including graphite and lithium.
The world's biggest gold producer Barrick Gold has posted a net Sept 2015 qtr loss of $US264M as it booked a $455M impairment charge related primarily to an accounting reclassification of its Zaldivar Copper Mine in Chile as "held-for-sale," after agreeing to sell 50% of it to copper miner Antofagasta for $1B, Reuters reports.
Debt reduced to $11.2B from $13.1B at the start of the year.