PERTH (miningweekly.com) – The new MD and CEO of ASX-listed Oz Minerals on Wednesday announced a strategic review of the company’s operations, taking into account all aspects of the company, including costs and future opportunities.

Andrew Cole told shareholders that the company needed to reshape itself to meet the challenges of a changing resources sector.

“Over the last eight weeks, I’ve spent a significant amount of time listening to key stakeholders, including our shareholders and staff. While today’s quarterly production figures highlight Oz Minerals is on a sound footing, all of those I’ve spoken with understand we need to respond to the changing dynamics of the sector we’re operating in. Our response begins today,” Cole said.

The review would be completed before the end of April; however, Cole noted that an early decision had been reached to reduce the size of the company’s corporate office, to restructure the corporate function and the move the head office from Melbourne to Adelaide.

Cole said a key factor in the relocation decision had been an agreement reached with the South Australian government, to partner on technical and infrastructure projects, which could improve the Carrapateena asset.

The South Australian government would provide funding of some A$10-million for testwork, at a demonstration plant scale, for a hydrometallurgical process that could see significant benefits for the Carrapateena project.

Oz Minerals would itself commit A$18-million to do this testwork in 2015.

The process upgrades copper, while significantly reducing uranium in concentrates and produces a highly attractive end-product, Cole said.

The second part of the agreement would see the company and state government collaborate on the development of infrastructure solutions which could further improve the economics of Carrapateena.

An August study revealed that the project was expected to deliver 114 000 t/y of copper and 117 000 oz/y of gold, at steady state, over a mine life of about 24 years, delivering revenue of A$22.1-billion.

Cole said that the agreement with the state government would not only open up future opportunities through the joint development of infrastructure, but would also encourage innovation in partnering to develop a new copper production process which delivered an attractive end product.

“Not only is this innovative partnership with both the state government and local universities, South Australia is also where our key projects are located; it makes sense to be based there and I’m confident we can develop future local, national and international projects from Adelaide.”

Meanwhile, Oz Minerals on Wednesday reported that production from its Prominent Hill mine, in South Australia, exceeded full-year guidance for both copper and gold.

Copper production for the quarter ended December reached 26 002 t, while gold production reached 36 288 oz, bringing full-year production to 92 615 t of copper and 148 192 oz of gold.

This was compared with the guidance of between 85 000 t and 90 000 t of copper and between 130 000 oz and 140 000 oz of gold.

Oz Minerals noted that operations at the openpit mine at Prominent Hill realised significant improvements during the full year, which contributed to the operation returning to a 100 000 t/y copper production run rate by the end of the third quarter.

First production from the Malu underground mine was also achieved in October.

C1 cash costs for the year were also lower than guidance, reaching $90.70/lb during the period, on the back of the higher gold production and lower costs at the Malu openpit, as well as a lower Australian/US dollar exchange rate.