(Alliance News) - Antofagasta PLC on Wednesday said its annual copper and gold production was in line with company guidance, though in both cases remained lower than 2019 due to lower grades at Centinela Concentrates.
For 2020 as a whole, Antofagasta reported copper production of 733,900 tonnes, in line with its guidance for the lower end of between 725,000 and 755,000 tonnes. This represented a 4.7% drop from 2019's "record production" of 770,000 tonnes and was mainly the result of expected lower grades at Centinela Concentrates.
For the fourth quarter alone, copper production was 192,600 tonnes, up 14% from 169,600 tonnes in the third quarter.
Annual gold production was 204,100 ounces, above guidance but a sharp 28% drop from 2019's figure of 282,300 ounces due to lower Centinela grades. Fourth quarter gold production was 54,700 ounces, a 43% jump from the third quarter figure of 38,300 ounces thanks to increased throughput, grades and recoveries at Centinela.
Molybdenum annual production came to 12,600 tonnes, up 8.6% year-on-year from 11,600 tonnes, within guidance, with fourth quarter production up 8.8% at 3,700 tonnes from 3,400 tonnes.
Net cash costs for 2020 amounted to USD1.14 per pound, below guidance and a 6.6% drop from 2019 thanks to lower cash costs before by-product credits.
For 2021, Antofagasta is guiding for copper production of between 730,000 and 760,000 tonnes; gold production of between 240,000 and 260,000 ounces, and between 9,500 and 11,000 tonnes of molybdenum.
Additionally, the company forecasts 2021 group cash costs of USD1.65 per pound before by-product credits and USD1.25 per pound after. 2021 capital expenditure is forecast at USD1.6 billion.
Antofagasta said: "Guidance assumes Covid-19 will remain in place for all of 2021, limiting transport to and from site and available camp accommodation, and requiring the extensive use of remote working and the implementation of a full set of health controls at our operations and offices. Considering the unprecedented situation, further changes may be required during the year."
As at the end of December, Antofagasta's Los Pelambres Expansion project was 45% complete after restarting in August. The revised capital cost estimate resulting from the review is USD1.7 billion, rising from an initial USD1.3 billion, with completion now expected early in the second half of 2022.
The company explained that: "Given the high degree of interactions with the existing operations and the nearby communities, the very high manpower requirements during peak construction in the original project execution plan have been revised down to address the Covid-19 risks and restrictions.
"These restrictions are assumed to continue for the whole of 2021, limiting on-site manpower to approximately 75% of the original planned levels which results in the requirement to extend the original construction schedule."
Chief Executive Ivan Arriagada highlighted that: "For a second year in a row, there were no fatalities and our safety performance continues to improve at all our operations."
"We expect another solid performance in 2021 with copper production of 730-760,000 tonnes at a net cash cost of USD1.25 per pound as ore grades increase at Centinela Concentrates and operating efficiency at our mines remains high."
Shares in Antofagasta were up 0.7% at 1,521.00 pence in London on Wednesday morning.
By Anna Farley; annafarley@alliancenews.com
Copyright 2021 Alliance News Limited. All Rights Reserved.
Antofagasta (ANTO)
