TSX-listed First Quantum Minerals has achieved its highest ever yearly copper production, with output rising by 11% to 779 000 t in 2020.
The company reported record-breaking production at Sentinel, in Zambia, and said that its other operations were resilient, particularly Cobre Panama, in Panama, despite the significant challenges brought about by Covid-19.
Copper production during the fourth quarter of 2020 was 203 000 t, in line with that produced in the fourth quarter of 2019.
Sentinel produced a record 251 000 t in 2020, which is 31 000 t more than in the comparable period of 2019, reflecting a significant increase in throughput to 57-million tonnes for the year.
As a result of continued higher throughput and favourable grades copper production in the fourth quarter was 63 000 t – an increase of 24% from the corresponding period in 2019.
Cobre Panama copper production in the fourth quarter of 2020 was 66 000 t – an increase of 6 000 t when compared with the fourth quarter of 2019, as the mine continued to operate under strict protocols in line with guidelines from the local Health Ministry and the planned seven-day shutdown of the SAG mills in October.
The copper production of Kansanshi, in Zambia, for the fourth quarter of 2020 was 53 000 t, a decline of 8 000 t when compared with the fourth quarter of 2019 resulting from the lower grades and oxide recoveries.
COVID-19 & GUIDANCE
First Quantum reports that it continues to maintain defensive health and sanitary protocols and to support the government health authorities in each jurisdiction according to the needs across all of its sites and operations to combat the spread of Covid-19.
As the pandemic has worsened globally, the company has identified several cases amongst the workforce, and as such, all of the cases have been effectively contained and isolated, according to the established protocols and in coordination with local health authorities, with limited impact to operations.
In terms of guidance, First Quantum reports that capital spending in 2020 was about $50-million lower than the previously issued guidance of $675-million.
For 2021 and 2022, the company forecasts that capital expenditure (capex) of $950-million will be required, which includes $40-million in each year on the smelter expansion at Kansanshi. For the years 2021 and 2022, First Quantum has also included a total of about $100-million in capex deferred from 2020.
In 2023, capex is expected to be $1.05-billion and includes $270-million for the proposed expansion at Kansanshi. This project is subject to board approval and the timing could be accelerated or delayed depending on capital availability, commodity prices and the Zambian fiscal regime.
Project capex across the three years also provides for the expansion to 100-million tons a year at Cobre Panama. The majority of this capital is for pre-strip and mine fleet for Colina pit and process plant upgrades, including the secondary crushing screening plant and the sixth ball mill.
Sustaining capex is on average about $250-million a year, but is expected to be up to $40-million higher in 2021 with planned maintenance of the Kansanshi smelter.