Diamond output leap helps Anglo

JOHANNESBURG (miningweeekly.com) – A sharp rise in rough diamond production at a time of stable diamond trading conditions has boosted diversified mining company Anglo American in the three months to June 30, when overall production was 8% up on a copper-equivalent basis.

Rough diamond production increased by 36% to 8.7-million carats, with production in Canada reporting a nigh sixfold rise to one-million carats on the Gahcho Kué mine’s ramp-up, with production at De Beers Consolidated Mines in South Africa jumping 71% to 1.4-million carats on higher grades at the Venetia diamond mine in Limpopo. 

Operational improvements increased iron-ore volumes from the Sishen mine of Kumba Iron Ore by 38% and the opencast Mogalakwena mine of Anglo American Platinum (Amplats) made the London- and Johannesburg-listed company’s quarterly highlights list, with a 15% output rise on higher grades and increased throughput.

Copper production from South America stood still on mine stoppages at El Soldado that higher Los Bronces production could only partially offset, and metallurgical coal production from Australia fell 19% on Cyclone Debbie’s disruption of the rail network, two longwall moves and ongoing geological issues at Grosvenor. 

The sale of the Rustenburg Platinum Mine to Sibanye last year resulted in Amplats' managed-mine platinum production decreasing 25% to 283 700 oz, but this was made up for by the purchase of platinum concentrate from Sibanye. Excluding Rustenburg, own mined production rose 7% and platinum metal in concentrate rose by 5% to 617 100 oz. (See separate report on Amplats).

The purchase of platinum concentrate from associates increased by 4% to 72 500 oz and the purchase of concentrate from third parties by 126 400 oz to 132 300 oz.

IRON-ORE PRODUCTION

Anglo’s iron-ore production from Kumba Iron Ore rose 28% to 11.4-million tonnes, with Sishen’s contribution rising 38% to 7.9-million tonnes on fleet efficiencies and higher plant yields.

At the newer Kolomela mine, iron-ore production rose 11% to 3.5-million tonnes, taking iron-ore export sales from both operations to an 8% higher 9.4-million tonnes.

Iron-ore production from Minas-Rio in Brazil rose 24% to 4.3-million tonnes as the operation ramps up to operating capacity. 

Manganese ore production increased 7% to 843 300 t, 9% more coming from the South African operations and 5% more from the Australian operations.

Manganese alloy production increased by 32% to 39 300 t, with the South African manganese alloy producer still operating only one of its four furnaces. 

COAL PRODUCTION

South Africa’s primary export thermal coal production fell by 8% to 4.1-million tonnes on operational challenges at Khwezela, associated with the integration of the Kleinkopje and Landau mines.

In addition, there was a production fall from Mafube owing to the mine transitioning to a new pit. 

Eskom-related steam coal production increased by 3% to 6.9-million tonnes, and the Eskom-tied New Vaal, New Denmark and Kriel mines are on track for sale to the black-controlled Seriti Resources by year-end.

Attributable coal production from the Cerrejón in Colombia rose 5% to 2.4-million tonnes while export metallurgical coal production fell 19% to four-million tonnes on longwall moves at Australia’s Moranbah and Grasstree mines.

Australia’s export thermal coal production dropped 70% to 0.3-million tonnes following the cessation of mining activities at Drayton.

Full-year production guidance for export thermal coal from South Africa and Cerrejón remains unchanged at 29-million tonnes to 31-million tonnes, with expectations that it will be at the lower end of this range because of the operational challenges at Khwezela.

Export metallurgical coal’s production guidance for the full year remains at 19-million tonnes to 21-million tonnes, with expectations that it will be at the lower end of this range because of geological issues at Grosvenor.

DIAMOND PRODUCTION

Rough diamond production by group company De Beers leapt 36% to 8.7-million carats, with production from Debswana in Botswana rising 14% to 5.9-million carats.

Orapa’s production increase of 44% on Plant 1’s emergence out of care and maintenance was offset by Jwaneng’s 3% production fall. 

Production from Namdeb in Namibia rose 32% to 0.4-million carats on the availability of Debmarine Namibia’s Mafuta vessel, which was on extended in-port maintenance in last year’s corresponding quarter.

Consolidated rough diamond sales in the first half of the year totalled 20-million carats, compared with 18.3-million carats in the first half of last year, but the average realised price of $156/ct this year was 12% lower than last year’s average realised price.

Full-year diamond production guidance remains unchanged at 31-million to 33-million carats. 

COPPER PRODUCTION

Copper production fell 2% to 140 800 t, with attributable production at Collahuasi falling 9% to 51 000 t and production at El Soldado falling 13% to 10 800 t and production from Los Bronces increasing 4% to 79 000 t.

Sales volumes were hit by temporary port closures in Chile owing to poor weather conditions and heavy tidal swells limiting vessel availability, as well as by higher arsenic content in copper concentrate from Collahuasi, which restricted sales into China.

As at end June, Anglo had 105 000 t of copper provisionally priced at 269c/lb.

Full-year copper production guidance remains unchanged at 570 000 t to 600 000 t. 

NICKEL PRODUCTION

Nickel production increased by 2% on stable smelting at Barro Alto but output from Codemin fell 4% to 2 200 t owing to maintenance. 

Full-year nickel production guidance remains unchanged at 43 000 t to 45 000 t. 

Exploration expenditure for the quarter totalled $23-million, an increase of 2%, and evaluation expenditure for the quarter totalled $2-million, an increase of 31%.

“Through the improvements we’ve made to our portfolio and the efficiencies we are driving, we continue to unlock the potential,” said Anglo CEO Mark Cutifani.

“The production ramps at Gahcho Kué, Minas-Rio and Grosvenor are also contributing to these ongoing positive performance trends. We’ve increased the full year production guidance for Kumba Iron Ore and are on track to deliver full year guidance across the rest of our products,” he added in a release to Creamer Media's Mining Weekly Online.

Anglo’s mining operations, growth projects and exploration and marketing activities extend across Southern Africa, South America, Australia, North America, Asia and Europe.