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Fortescue posts record quarter

Image shows Fortescue mining operations

Photo by Bloomberg

27th January 2023

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – Iron-ore major Fortescue Metals has reported a record quarter in the three months to December, driving its best-ever half-year operating performance.

“The Fortescue team delivered our highest ever December quarterly shipments of 49.4-million tonnes, our best ever half-year, grew the mineral and green energy business globally, strengthened our balance sheet, kept costs low, all while maintaining our excellent safety performance,” said executive chairperson Dr Andrew Forrest.

Iron-ore shipments in the second quarter were up from the 47.5-million shipped in the first quarter, bringing half-year shipments for the first half of the year to 96.9-million tonnes, a 4% increase on the previous corresponding period and marking a record half-year.

Average revenue of $87/t was achieved, realising 88% of the average Platts 62% CFR Index for the quarter, while C1 costs for the quarter were down 3% on the previous quarter to $17.17/t.

“We are now nearing the 200-million-tonne annualised rate in our iron-ore business even before we commission Iron Bridge. Our company has never performed better on the mining, exploration, green hydrogen and green energy development front, while leading the world as the first heavy industry company to achieve real zero with a fully costed plan. Fortescue will step beyond fossil fuels this decade, saving shareholders approximately $1-billion a year and setting the global stage for all environmentally responsible companies to follow,” said Forrest.

During the quarter under review, Fortescue progressed the development of its 22-million-tonne-a-year Iron Bridge project, with first production scheduled for the end of the March quarter this year.

First ore was processed in the plant at the end of October.

The project is estimated to cost at the higher end of its capital estimate of between $3.6-billion and $3.8-billion, with Fortescue’s share amounting to between $2.7-billion and $2.9-billion.

“Demand for Fortescue’s suite of iron-ore products remains strong and our entry into the higher-grade segment of the market has been well received, with significant interest in the Iron Bridge magnetite concentrate. This is further supported by the Belinga project in Gabon, with engagement rapidly advancing and very positive geological assessments from ground mineral surveys. The initial drilling programme is expected to commence in March 2023. We also continue to develop our rare earths division as announced at the 2022 annual general meeting,” Forrest added on Friday.

Looking at the full year, Fortescue has set an iron-ore shipment guidance of between 187-million and 192-million tonnes, at a C1 cost of between $18/t and $18.75/t, with capital expenditure (capex) for the year anticipated at $2.7-billion to $3.1-billion, excluding expenditure for the Fortescue Future Industries operations, which is anticipated to have between $500-million and $600-million in operating expenditure, and a further $230-million of capex.

Edited by Creamer Media Reporter

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