Antofagasta Regulatory News (ANTO)

26 Oct 2005 10:00

Antofagasta PLC26 October 2005 The following statement has been released by Antofagasta plc and is distributedin London by Bankside Consultants Ltd on behalf of the Company. Contact: KeithIrons, 020 7367 8873. 26 October 2005 Antofagasta plcQuarterly Production Report - Q3 2005 Highlights • Group copper production was up 6.9% in Q3 at 116,000 tonnes, as all three mines increased their production • Molybdenum production at Los Pelambres was 2,000 tonnes in Q3 compared with 2,500 tonnes in Q2, mainly due to lower molybdenum ore grades, but production to end September 2005 of 6,700 tonnes compares with 5,800 tonnes to end September 2004. • Group cash costs in Q3 were 31.2 c/lb compared with negative 9.6 c/lb in Q2, mainly due to lower by-product credits. +----------------------+-------+------+-------+------+---------+--------+---------+| | Q1 | Q2 | Q3 | Q4 | Acc | Acc |Full Year||Group Total | 2005 | 2005 | 2005 | 2005 | 2005 | 2004 | 2004 |+----------------------+-------+------+-------+------+---------+--------+---------+|Total copper | | | | | | | ||production | 118.9| 108.5| 116.0| | 343.4| 366.1| 498.4||('000 tonnes) | | | | | | | |+----------------------+-------+------+-------+------+---------+--------+---------+|Weighted average | | | | | | | ||Cash costs (cents per | (7.9)| (9.6)| 31.2| | 4.8| 28.9| 24.3||pound) | | | | | | | |+----------------------+-------+------+-------+------+---------+--------+---------+ Los PelambresLos Pelambres produced 81,000 tonnes of payable copper in Q3, an increase of8.9% over the previous quarter. This increase was partly due to better oregrades as expected but mainly because of higher ore throughput which averaged131,900 tonnes per day, 6.3% higher than in the previous quarter and 6.6% abovethe average for 2004. The increased throughput, marginally offset by lowermetallurgical recoveries, was due to better ore quality as well as higher plantutilisation which reached 98% during the quarter. Cash costs before by-product credits reached 75.6 c/lb in the quarter, 0.8%lower than the last quarter. Higher cash costs in Q3 were principally due tomarket factors, mainly higher roasting charges for molybdenum concentrate andhigher treatment and refining charges for copper concentrate (where highercopper prices have increased the effect of price participation). By-product credits decreased to 70 c/lb in Q3, compared to 126.8 c/lb in Q2, asa result of a number of factors. Molybdenum production decreased 18.3% to 2,000tonnes in Q3, due to lower than expected grades. Molybdenum market prices, eventhough still at historically high levels, averaged US$31.0 per pound in Q3,compared to US$35.3 per pound in Q2. This also resulted in negative pricingadjustments of US$ 20.1 million for final settlement of provisional sales,compared with positive adjustments of US$ 16.1 million in Q2, with an impact of21 c/lb in cash costs. The by-product credit, which is expressed in cents perpound of copper produced, was also affected by higher copper production in Q3. Cash costs net of by-product credits, were 5.6 c/lb, compared to negative 50.6 c/lb in Q2, mainly due to lower by-product credits as explained above. El TesoroCopper production for the quarter reached 24,000 tonnes, 1.7% higher than in theprevious quarter, due to increased ore throughput. The ore grade decreased to1.14% in Q3 as expected under the mine plan. Recoveries in Q3 fell to 75%compared with 81.8% in Q2 due to an increased presence of carbonates in the oreand the lower ore grades. Cash costs increased by 13 c/lb reaching 73.1 c/lb in Q3 due to the higherwaste-to-ore ratio, the lower ore grade, the higher water costs (which in thecase of El Tesoro are indexed to the copper price), the strengthening of theChilean peso against the US dollar and higher fuel prices. The regional environmental authority (COREMA) recently reversed its decision of8 September which had initially approved El Tesoro's optimisation project, andrequested a full Environmental Impact Study instead of an Environmental ImpactDeclaration, to assess the impact of the project on local water supplies. ElTesoro has appealed to the national environmental authority (CONAMA) againstthis decision and a final resolution is expected shortly. MichillaMichilla produced 11,100 copper tonnes in Q3, 4.8% more than in the lastquarter. This increase was mainly due to improved ore grades at the undergroundmine. Ore grades at the open pit continue lower than originally expected for theyear due to the difficulty of operating near old mine workings. Ore throughputhas also increased marginally over Q2. Cash costs reached 127.6 c/lb in Q3, 4.4 c/lb more than in the previous quarter,but the high costs in both quarters were mainly due to lower grades in the Linceopen pit and the operational issues previously reported at the underground minewhich affected ore production. These operational factors have since beenresolved with normal rates of ore production restored by the end of September.Cash costs have also been affected by the strengthening of the Chilean peso,higher input costs and the additional associated costs for infill drilling inthe Lince open pit. TransportTotal tonnes transported were 1.8% above last year, reaching 3.3 million tonnesfor rail and 1.1 million tonnes for road transport. WaterSales of water during the three first quarters reached 24.5 million cubicmetres, which represents an increase of 1.2% compared to the same period lastyear. +--------------------+-------+-------+--------+-------+--------+--------+--------+| | Q1 | Q2 | Q3 | Q4 | Acc | Acc | Full ||Los Pelambres | 2005 | 2005 | 2005 | 2005 | 2005 | 2004 | Year || | | | | | | | 2004 |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Daily average ore | | | | | | | ||treated | 129.0| 124.0| 131.9| | 128.3| 123.7| 125.9||('000 tonnes) | | | | | | | |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Average ore grade | | | | | | | ||(%) | 0.79| 0.77| 0.80| | 0.79| 0.89| 0.88|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Average recovery | | | | | | | ||(%) | 91.0| 90.2| 88.4| | 89.8| 88.5| 89.1|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Concentrate produced| | | | | | | ||('000 tonnes) | 222.0| 202.6| 220.9| | 645.4| 707.6| 948.8|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Average concentrate | | | | | | | ||grade | 37.5| 38.6| 39.0| | 38.4| 37.8| 38.2||(%) | | | | | | | |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Fine copper in | | | | | | | ||concentrate | 83.3| 76.9| 83.7| | 244.0| 267.4| 362.6||('000 tonnes) | | | | | | | |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Payable copper in | | | | | | | ||concentrate | 80.6| 74.4| 81.0| | 235.9| 258.5| 350.6||('000 tonnes) | | | | | | | |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Payable moly | | | | | | | ||('000 tonnes) | 2.2| 2.5| 2.0| | 6.7| 5.8| 7.9|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Cash costs (before | | | | | | | ||by-product) (cents | 64.0| 76.2| 75.6| | 71.8| 51.9| 53.7||per pound) | | | | | | | |+--------------------+-------+-------+--------+-------+--------+--------+--------+|By-product credits | | | | | | | ||(cents per pound) |(109.9)|(126.8)| (70.0)| | (101.5)| (37.1)| (45.8)|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Cash costs | | | | | | | ||(cents per pound) | (45.9)| (50.6)| 5.6| | (29.7)| 14.7| 7.9|+--------------------+-------+-------+--------+-------+--------+--------+--------+ +--------------------+-------+-------+--------+-------+--------+--------+--------+| | Q1 | Q2 | Q3 | Q4 | Acc |Acc 2004| Full ||El Tesoro | 2005 | 2005 | 2005 | 2005 | 2005 | | Year || | | | | | | | 2004 |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Daily average ore | | | | | | | ||treated | 26.3| 22.9| 29.0| | 26.1| 25.1| 25.4||('000 tonnes)* | | | | | | | |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Average ore grade | | | | | | | ||(%) | 1.34| 1.41| 1.14| | 1.28| 1.34| 1.35|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Average recovery | | | | | | | ||(%) | 82.4| 81.8| 75.0| | 79.7| 78.1| 78.1|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Copper cathodes | | | | | | | ||('000 tonnes) | 26.3| 23.6| 24.0| | 73.8| 71.5| 97.8|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Cash costs | | | | | | | ||(cents per pound) | 57.8| 60.1| 73.1| | 63.5| 52.1| 52.4|+--------------------+-------+-------+--------+-------+--------+--------+--------+ +--------------------+-------+-------+--------+-------+--------+--------+--------+| | Q1 | Q2 | Q3 | Q4 | Acc | Acc | Full ||Michilla | 2005 | 2005 | 2005 | 2005 | 2005 | 2004 | Year || | | | | | | | 2004 |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Daily average ore | | | | | | | ||treated | 15.3| 14.5| 14.9| | 14.9| 16.0| 16.1||('000 tonnes) | | | | | | | |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Average ore grade | | | | | | | ||(%) | 1.09| 0.99| 1.11| | 1.07| 1.10| 1.11|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Average recovery | | | | | | | ||(%) | 76.1| 75.7| 74.8| | 75.5| 75.0| 75.4|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Copper cathodes | | | | | | | ||('000 tonnes)* | 12.0| 10.6| 11.1| | 33.7| 36.2| 50.0|+--------------------+-------+-------+--------+-------+--------+--------+--------+|Cash costs | | | | | | | ||(cents per pound) | 102.4| 123.2| 127.6| | 117.3| 84.9| 85.6|+--------------------+-------+-------+--------+-------+--------+--------+--------+ +--------------------+-------+-------+--------+-------+--------+--------+--------+| | Q1 | Q2 | Q3 | Q4 | Acc | Acc | Full ||Transport | 2005 | 2005 | 2005 | 2005 | 2005 | 2004 | Year || | | | | | | | 2004 |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Rail tonnage | | | | | | | ||transported | 1,126| 1,090| 1,085| | 3,301| 3,297| 4,479||('000 tons) | | | | | | | |+--------------------+-------+-------+--------+-------+--------+--------+--------+|Road tonnage | | | | | | | ||transported | 348| 379| 395| | 1,122| 1,047| 1,414||('000 tons) | | | | | | | |+--------------------+-------+-------+--------+-------+--------+--------+--------+ +---------------------+-------+-------+-------+-------+--------+--------+---------+| | Q1 | Q2 | Q3 | Q4 | Acc | Acc |Full year||Water | 2005 | 2005 | 2005 | 2005 | 2005 | 2004 | 2004 |+---------------------+-------+-------+-------+-------+--------+--------+---------+|Water volume sold - | | | | | | | ||potable and untreated| 8,315| 8,242| 7,969| | 24,526| 24,228| 32,575||('000 m3)* | | | | | | | |+---------------------+-------+-------+-------+-------+--------+--------+---------+ (*) Note: Water volumes include water transportation of 336 thousand m3 in Q1,234 thousand m3 in Q2 and 236 thousand m3 in Q3 For further enquiries: Desmond O'Conor, Antofagasta plcdoconor@antofagasta.co.uk (44) 20 7808 0988 Hussein Barma, Antofagasta plchbarma@antofagasta.co.uk (44) 20 7808 0988 Alejandro Rivera, AntofagastaMinerals (56-2) 377 5145arivera@aminerals.cl Issued by: Keith Irons, Bankside Consultantskeith@bankside.com (44) 20 7367 8873 END This information is provided by RNS The company news service from the London Stock Exchange