PERTH (miningweekly.com) - Metals miner Oz Minerals on Wednesday reported that it was on target to produce its first ore from the Ankata underground mine development, at its Prominent Hill mine in South Australia, by the first quarter of this year.
The development of the underground mine to access the higher-grade Ankata deposit, started in November 2010, with the access decline reaching the orebody in August of last year.
The operation is scheduled to produce stoping ore in the first quarter of this year, and would then ramp up to the full production rate of 1.2-million tons a year in the third quarter of 2012.
Oz said in a statement that the underground mine was expected to contribute between 800 000 t and one-million tons of ore in the 2012 ramp-up year, at an average grade of between 2.3% and 2.8% copper.
In the three months to December, Oz Minerals produced some 26 802 t of copper and 37 814 oz of gold from its Prominent Hill operations, at a cash cost of $84.2/lb
For the year-to-date, the operation has produced 107 744 t of copper and 160 007 oz of gold, which were both in line with the previously advised guidance of between 100 000 t and 110 000 t of copper and 150 000 oz and 160 000 oz of gold.
In 2012, copper production guidance for the year has been maintained at between 100 000 t and 110 000 t, while gold production was expected to be between 130 000 oz and 150 000 oz.
Oz Minerals warned that the cash costs for the year would be impacted by the higher costs associated with the underground mining, as well as by higher mining rates associated with the cut-back to the north wall of the Malu pit, higher transport costs, higher unit labour costs, and reduced gold by-product credits.
Meanwhile, Oz also reported that it would spend some A$70-million on exploration at the Prominent Hill site during 2012.