Antofagasta Regulatory News (ANTO)

1 Aug 2006 10:00

Antofagasta PLC01 August 2006 1 August 2006 Antofagasta plc Quarterly Production Report - Q2 2006 Highlights • Group copper production in Q2 was 100,900 tonnes, compared with 107,000 tonnes in Q1. • Molybdenum production at Los Pelambres in Q2 was 2,100 tonnes, marginally above Q1. • Group cash costs for Q2 were 43.9 cents per pound, 11.7% lower than Q1 mainly due to improved by-product credits. Group Q1 Q2 Q3 Q4 Acc Acc Full YearTotal 2006 2006 2006 2006 2006 2005 2005 Total production of payable copper ('000 tonnes) 107.0 100.9 207.9 227.4 467.3 Total production of payable moly('000 tonnes) 2.0 2.1 4.1 4.7 8.7 Weighted average cash costs (cents per pound) 49.7 43.9 46.9 (8.7) 13.9 Los Pelambres Los Pelambres produced 67,500 tonnes of payable copper in Q2 and 141,600 tonnesin the first six months of 2006, 8.6% below the first six months of last year.The decrease was mainly due to a build-up of unfiltered copper concentrate atthe concentrator plant in May when repairs were carried out to the slurrypipeline, reducing the volume available for filtration at the port in thatmonth. This concentrate was partly processed at the port in June with theremainder processed in July, and is not expected to have any overall effect onproduction volumes for the full year. The reduced production in the first halfwas also partly due to lower daily ore throughput at the concentrator plant(resulting from a higher proportion of harder primary ore compared with 2005 aswell as programmed downtime to enable the construction of the 140,000 tonnes perday plant expansion) and lower recoveries, offset by the higher ore grade.Volumes shipped in the first six months of 2006 were 145,400 tonnes. Molybdenum production in Q2 increased to 2,100 tonnes and production in thefirst six months was 4,100 tonnes, in line with the year-to-date forecast but12.5% below the first half of 2005. The decrease was due to a combination ofchanges in levels of partly-processed molybdenum concentrate, the lower orethroughput level and lower recoveries (resulting from the characteristics of theore processed in the period), partly offset by the higher ore grade. Cash costs in Q2 were 18.5 cents per pound, compared with 29.8 cents per poundin Q1 due to improved by-product credits this quarter. Cash costs averaged 24.4cents per pound in the first six months of 2006 compared with negative 48.1cents in the first half of 2005. The increase compared with 2005 H1 was mainlydue to lower by-product credits (which decreased by 47.0 cents) and highertreatment and refining charges (which increased by 13.8 cents). Lower by-productcredits resulted mainly from lower molybdenum market prices (which averagedUS$23.7 per pound in 2006 H1 compared with US$33.4 per pound in 2005 H1) as wellas lower production. Treatment and refining charges increased through priceparticipation by smelters as the average LME copper price increased to 275.3cents per pound in 2006 H1 (compared with 151.1 cents per pound in 2005 H1). On-site and shipping costs for Q2 remained in line with Q1. Costs for the firstsix months of the year remain in line with forecast, but were 11.7 cents perpound above 2005 H1, due to lower production as well as higher costs for fuel,energy, explosives and services. El Tesoro Cathode production at El Tesoro in Q2 was 21,800 tonnes, an increase of 4.8%compared with Q1, as better ore grades compensated for lower recoveries.Production in the first six months of 2006 was 42,500 tonnes, in line withforecast but 14.7% lower than 2005 H1, as higher processing levels (followingcompletion of the 10.5 million tonnes per year throughput expansion at thebeginning of the year) were offset by expected lower grades and recoveries. Cash costs in Q1 were 79.8 cents per pound, in line with the previous quarter.Cash costs in the first six months of 2006 were 79.7 cents per pound comparedwith 58.9 cents per pound in 2005 H1, due to the lower production level andhigher waste-to-ore ratio, increased consumption of sulphuric acid and higherinput costs including fuel prices and copper price-linked payments. Michilla Michilla produced 11,600 tonnes of copper cathodes in Q2, reaching 23,800 tonnesin the first six months of 2006. The increase of 1,200 tonnes compared with 2005H1 was mainly due to higher grades, together with higher processing levels andbetter recoveries. Cash costs in Q2 were 123.9 cents per pound, 3.8 cents above the previousquarter. Cash costs averaged 122.0 cents per pound in the first six months of2006, below forecast but 8.8% above 2005 H1, reflecting higher costs at theunderground mine and higher prices for fuel and explosives. Transport Rail tonnages in the first half of 2006 were 3.8% lower than 2005 H1, mainly dueto lower tonnages from Codelco. However, road tonnages were 3.1% higher than thefirst half of 2005. Water The water division continued to perform strongly, with volumes reaching 9.2million cubic metres in Q2 and 18.5 million cubic metres in the first half of2006. This represented an increase of 11.9% over 2005 H1 as a result ofincreased consumption by both domestic and mining customers as well as highervolumes of water transported. Los Pelambres Q1 Q2 Q3 Q4 Acc Acc Full Year 2006 2006 2006 2006 2006 2005 2005 Production statistics Daily average ore treated ('000 tonnes) 120.9 119.5 120.2 126.5 128.1 Average ore grade (%) 0.81 0.84 0.82 0.78 0.80 Average recovery (%) 88.1 88.2 88.1 90.6 89.2 Concentrate produced ('000 tonnes) 194.8 200.2 395.0 424.6 865.1 Average concentrate grade (%) 39.6 40.0 39.8 38.0 38.5 Fine copper in concentrate ('000 tonnes) 76.6 69.8 146.4 160.3 333.8 Payable copper inconcentrate ('000 tonnes) 74.1 67.5 141.6 154.9 322.8 Average moly ore grade (%) 0.026 0.027 0.026 0.025 0.022 Average moly recovery (%) 74.4 76.0 75.2 80.0 79.9 Payable moly ('000 tonnes) 2.0 2.1 4.1 4.7 8.7 Cash costs statistics On-site and shipment costs (cents per pound) 54.5 56.8 55.6 43.8 47.1 Tolling chargesfor concentrates (cents per pound) 34.8 45.4 39.8 26.0 27.6 By - product credits (cents per pound)* (59.5) (83.7) (71.0) (118.0) (91.8) Cash costs (cents per pound) 29.8 18.5 24.4 (48.1) (17.1) (*) Note: By-products credits do not include any costs attributable to theproduction of molybdenum concentrate. By-product calculations also do not takeinto account unrealised mark-to-market gains at the beginning or end of eachperiod. El Tesoro Q1 Q2 Q3 Q4 Acc Acc Full Year 2006 2006 2006 2006 2006 2005 2005 Daily average ore treated ('000 tonnes) 29.7 28.6 29.1 24.6 27.2 Average ore grade (%) 0.99 1.18 1.08 1.37 1.23 Average recovery (%) 77.9 73.9 75.7 82.1 80.2 Copper cathodes ('000 tonnes) 20.8 21.8 42.5 49.9 98.1 Cash costs (cents per pound) 79.6 79.8 79.7 58.9 66.1 Michilla Q1 Q2 Q3 Q4 Acc Acc Full Year 2006 2006 2006 2006 2006 2005 2005 Daily average ore treated ('000 tonnes) 14.6 15.4 15.0 14.9 14.9 Average ore grade (%) 1.13 1.07 1.10 1.04 1.10 Average recovery (%) 76.2 76.4 76.3 75.9 75.4 Copper cathodes ('000 tonnes) 12.1 11.6 23.8 22.6 46.4 Cash costs (cents per pound) 120.2 123.9 122.0 112.2 118.8 Transport Q1 Q2 Q3 Q4 Acc Acc Full Year 2006 2006 2006 2006 2006 2005 2005 Rail tonnage transported ('000 tons) ** 1,122 1,011 2,133 2,216 4,336 Road tonnage transported ('000 tons) 383 367 750 728 1,522 (**) Note: A minor adjustment has been made to the comparative figure for Q1from the previously reported amount of 1,141,000 tons. Water Q1 Q2 Q3 Q4 Acc Acc Full Year 2006 2006 2006 2006 2006 2005 2005 Water volume sold - potable and untreated ('000 m3) *** 9,304 9,231 18,536 16,557 33,074 (***) Note: Water volumes include water transportation of 270,000 m3 in Q1 and740,000 m3 in Q2. For further enquiries: Santiago Alejandro Rivera, Antofagasta Minerals (56-2) 377 5145arivera@aminerals.cl London Desmond O'Conor, Antofagasta plcdoconor@antofagasta.co.uk (44) 20 7808 0988 Hussein Barma, Antofagasta plc (44) 20 7808 0988hbarma@antofagasta.co.uk Issued by: Keith Irons, Bankside Consultants (44) 20 7367 8873keith@bankside.com Oliver Winters, Bankside Consultants (44) 20 7367 8874oliver.winters@bankside.com This information is provided by RNS The company news service from the London Stock Exchange