JOHANNESBURG (miningweekly.com) – Mineral exploration, development and mining company African Minerals’ Tonkolili iron-ore project, in Sierra Leone, achieved record production and sales during the first quarter of the year, the company announced on Monday.
During the three-month period, the mine produced 5.3-million tons of product, compared with 3.9-million tons during the fourth quarter of last year.
First quarter sales amounted to 4.6-million tons, up 19% from the 3.8-million tons exported during the fourth quarter.
"The Tonkolili project ramp-up programme continues to make good progress. The first quarter of 2014 marks our best performance yet, surpassing the record set by the fourth quarter of 2013 and setting our new operational benchmark,” African Minerals CEO Bernie Pryor commented.
He pointed out that the mine’s cash costs also continued to improve, having fallen to $37/t as production volumes increased with a commensurate building of cash flow.
“Preparations are also under way for the annual seasonal impacts of the coming wet season, and we look forward to testing our interventions, which should give us the flexibility to successfully manage the coming months, and importantly also reduce our reliance on the production of A32 materials, allowing us to achieve higher received pricing,” he said.
Pryor stated that the company was maintaining its guidance of exporting between 16-million tons and 18-million tons during the calendar year, with C1 cash costs of between $34/t and $36/t.
The company was planning to exit the year at a sustainable run rate of 20-million tons a year, with cash costs expected to fall to $30/t at that production rate.
“We are well advanced in our next stage of growth targeting capital cost optimisation and expansion to our infrastructure capacity. We aim to exit 2014 with a 25-million-ton-a-year export capability, and to start the construction of our first friable haematite concentrator facility at the end of this year, with up to 10-million tons a year of final product concentrate processing capability being brought on line in 2016.
“This, together with the increased direct shipping ore (DSO) resource recently announced, allows us to extend the life of our concurrent DSO operations and further defer capital for additional concentrator units,” Pryor said.
During the first quarter, the group also reduced its net debt from $473-million to $391-million.