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Glencore maintains steady Q1 production

4th May 2017

By: Natasha Odendaal

Creamer Media Senior Deputy Editor

     

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JOHANNESBURG (miningweekly.com) – Production in the first quarter of the year across several of triple-listed Glencore’s operations worldwide was marred by adverse weather conditions, including Cyclone Debbie in Australia, flooding in Peru and higher-than-average rainfall in the Democratic Republic of Congo (DRC) and Hunter Valley, in Australia.

However, the global diversified natural resource company reported steady output for the first three months of the year, with weather-related impacts somewhat offset by planned ramp-ups, drawdowns from stockpiles, improved grades and operating efficiencies, besides others.

Glencore on Thursday reported that copper production from its own sources declined 3% year-on-year to 324 100 t, reflecting the grade variations at Alumbrera, in Argentina; the zinc/copper mix at Antamina, in Peru, as its mine plan progresses; and weather-related disruptions at Mutanda, in the DRC, and Antamina.

These were partly offset by a 16% increase in own sourced production from North Queensland.

The group‘s own-sourced zinc production of 279 200 t during the first quarter represented a 9% rise on the prior corresponding quarter, owing to the mine plan sequencing at Antamina and higher grades at the Kidd mine, in Canada.

“Modest production increases in the rest of the portfolio were within expected ranges. There are currently no plans to restart idled capacity in Australia and Peru,” Glencore commented.

Meanwhile, own-sourced nickel production for the three months under review decreased 10% to 24 900 t owing to maintenance stoppages at Murrin Murrin, in Australia, and Nikkelverk, in Norway, and partially offset by the ramp-up at Koniambo, in New Caledonia.

Operating efficiencies and the restarting of a furnace in the second half of last year contributed to a 10% year-on-year hike in Glencore’s attributable ferrochrome production for the first quarter of 2017 to 439 000 t.

Coal production for the first quarter increased 4% year-on-year to 30.9-million tonnes, attributed to stronger coking coal production, the geological challenges experienced in the base period at Oaky Creek, in Australia, and planned ramp-ups in the Australian thermal portfolio.

However, production was down 6% quarter-on-quarter on the back of adverse weather conditions in Australia and South Africa.

“Glencore’s oil entitlement interest of 1.4-million barrels was down 43% on the first quarter of 2016, reflecting ongoing depletion. A single-rig drilling campaign will recommence in Chad in the second half of 2017,” the company commented.

Meanwhile, Glencore hiked its full year 2017 marketing earnings before interest and tax guidance to between $2.3-billion and $2.6-billion, from the previous $2.2-billion to $2.5-billion.

The company’s 2017 production guidance is 1.3-million tonnes for copper; 1.1-million tonnes for zinc; 300 000 t for lead; 120 000 t for nickel; 1.6-million tonnes for ferrochrome and 135-million tonnes for coal.

Edited by Creamer Media Reporter

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