Base metals miner Lundin Mining performed well in the second quarter, with copper output at all its operations higher than in the prior-year comparable quarter, despite the impact of the Covid-19 pandemic.
The company increased copper output by 37% year-on-year to 65 285 t in the quarter under review, while zinc output fell 15% to 31 582 t. The miner also produced 44 000 oz of gold and 3 380 t of nickel.
Revenue climbed to $533.3-million, from $369.3-million in the corresponding period, owing to the inclusion of the Chapada mine, in Brazil. Net earnings rose to $48.3-million, from a loss of $8.6-million, while adjusted earnings jumped to $52.8-million, from an adjusted loss of $11.1-million in the comparable period.
Cash flows for the three months, ended June 30, were $37.6-million, while adjusted operating cash flow was $179-million.
Lundin president and CEO Marie Inkster said on Wednesday operations were set to improve in the second half of the year.
“While we have reduced Candelaria's full-year production guidance, Eagle's copper production has been increased, and cash cost guidance for both Chapada and Eagle have been improved,” she said.
The company lowered the copper guidance of Candelaria, in Chile, to between 145 000 t and 155 000 t, at a cash cost of $1.35/lb, from its previous guidance of 160 000 t to 175 000 t. The Eagle mine, in the US, will also produce slightly less than previously forecast, with its new guidance at 15 000 t to 18 000 t. Overall, the group’s copper guidance is now 264 000 t to 293 000 t, from its previous guidance of 251 000 t to 274 000 t.
For Chapada and Eagle, yearly cash cost guidance is improving by 24% and 15%, respectively.
The zinc guidance remains unchanged at 142 000 t to 152 000 t, and so does the nickel guidance at 15 000 t to 18 000 t.
The company’s gold guidance has been increased by 10 000 oz to a range of 175 000 oz to 190 000 oz.
Operations performed well in the quarter with copper production at all operations higher than the prior year comparable quarter and record combined throughput of over one-million tonnes at Neves-Corvo, in Portugal.
The Zinc Expansion Project (ZEP) at Neves-Corvo continues to be temporarily suspended and business continuity measures have been implemented at all of the miner’s sites in an effort to mitigate and minimize potential future impacts of the pandemic, particularly with travel and contractors from outside the immediate mine regions.
To date, production disruptions have been minimal and there has been no significant disruption in the delivery or receipt of goods at Lundin’s operations as a result of Covid-19.
Lundin’s 80%-owned Candelaria produced 35 060 t of copper, and about 21 000 oz of gold concentrate on a 100% basis. Copper production for the quarter was higher than the prior year’s quarter, primarily owing to higher copper head grades and recoveries as more higher-grade openput and underground ore was mine.
However, throughput was lower than planned owing to ore hardness, operational issues and an unplanned maintenance stop.
Covid-19 has also further delayed the Candelaria Mill Optimisation Project, and the installation of the final ball mill motor is now planned for January 2021.
Lundin’s wholly owned Chapada, meanwhile, produced 13 799 t of copper and about 23 000 oz of gold, in line with plans. The 100%-owned Eagle project produced 3 380 t of nickel and 4 102 t of copper during the quarter.
Neves-Corvo, also wholly owned by Lundin, produced 10 559 t of copper and 18 986 t of zinc for the quarter, while Zinkgruvan produce 13 596 t of zinc and had a lead production of 3 799 t.