Fortescue's cost cuts continue

PERTH (miningweekly.com) – Iron-ore major Fortescue Metals has delivered another quarter of consistent production, with the miner shipping 42.2-million tonnes of iron-ore during the three months to December.

This was 4% below the 43.8-million tonnes shipped in the first quarter of 2017.

However, C1 cash costs for the second quarter reduced to $12.54/t, compared with the $13.55/t reported in the first quarter, as the miner’s productivity and efficiency initiatives continued to drive performance and lower unit costs.

“Fortescue has delivered another strong quarterly result, achieving improved safety performance, consistent with production and sustained cost reductions across all of our operations. Through continued focus on efficiency and productivity initiatives, C1 costs were lowered for the twelfth consecutive quarter,” said CEO Nev Power.

“Our strong operating results, together with positive market conditions have generated excellent cash flow which supported a further $1-billion of debt repayments in December.

“Initial gearing targets have been surpassed and it is pleasing to see the ratings agencies recognise our performance and upgrade their ratings and outlook accordingly.”

For the 2017 financial year, Fortescue expected to ship between 165-million and 170-million tonnes, with C1 costs expected to reach between $12/t and $13/t.