Strong production, lower costs see Oz tracking towards FY guidance

PERTH (miningweekly.com) – Copper/gold producer Oz Minerals has reported an increase in production during the three months to June, compared with the previous quarter.

Copper production increased from 25 079 t in the March quarter to 28 163 t in the June quarter. Gold production increased from 26 135 oz to 32 136 oz in the same period.

C1 cash costs for the quarter declined from $1/lb to $0.81/lb.

The increase in production was driven by higher volumes of underground ore mined, the company said on Tuesday.

“Strong production and lower costs quarter-on-quarter see us tracking positively towards achieving annual guidance. The Prominent Hill mine plan has production ramping up in the latter half of the year, supported by completion of the second permanent decline expected in late August,” said Oz Minerals MD and CEO Andrew Cole.

For the full year, the Prominent Hill mine, in South Australia, is expected to deliver between 105 000 t and 115 000 t of copper, and between 115 000 oz and 125 000 oz of gold, with C1 cash cost estimated at between $0.85/lb and $0.95/lb.

Cole noted that the quarter ended with a cash balance of A$625-million, up from A$594-million at the end of the first quarter, after a A$22-million investment in the Carrapateena project, a A$20-million addition to ore inventory, and a A$69-million tax payment.

Meanwhile, Cole noted that Oz Minerals was also advancing its pipeline of exploration projects, with drilling and geophysics work under way.

“A decision was made to exit the Yandal One exploration joint venture with Toro Energy this quarter, as drilling programmes did not meet the required technical hurdles. Our approach to exploration sees us exit projects quickly if they do not meet our expectations.”