Wet weather rains on Atlas parade
PERTH (miningweekly.com) – Wet weather conditions have seen iron-ore miner Atlas Iron ship fewer tonnes during the three months to March, while C1 cash costs increased from A$34/t to A$36/t, compared with the previous corresponding period.
The volume of ore shipped during the March quarter declined from four-million tonnes shipped at the end of the December quarter, to 3.2-million tonnes, with wet weather and the expected decline at the Wodgina mine, as it approached the end of its mine life, resulting in lower production.
Mining at Wodgina was completed, as scheduled, on April 6.
MD Cliff Lawrenson told shareholders on Tuesday that despite the decline in production, the company had made significant progress on all fronts.
“Atlas has posted a solid production result despite the challenging weather. Margins were good and free operating cash flow was strong.”
The adverse weather conditions caused disruptions across all Atlas sites, and impacted haulage, Lawrenson said, noting that ports were shut owing to the weather, and unscheduled repairs and scheduled maintenance reduced both shipment and haulage, leading to increased inventory at ports and sites.
C1 and full cash costs were up slightly, driven by reduced port fee relief, reduced fixed cost dilution and higher seaborne freight.
Meanwhile, during the quarter under review, Atlas approved the A$47-million to A$53-million development of its Corunna Downs project, which had the potential to deliver four-million tonnes a year of lumps and fines direct shipping ore over an initial five- to six-year mine life.
First ore from Corunna Downs is now expected to be shipped in the March 2018 quarter.
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