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Anglo revises full-year production guidance for PGMs, met coal, iron-ore lower

21st April 2022

By: Marleny Arnoldi

Deputy Editor Online

     

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Diversified miner Anglo American has reported a 10% year-on-year decrease in production in the first quarter of this year and adjusted downward its full-year guidance for platinum group metals (PGMs), iron-ore and metallurgical (met) coal production.

This “normally slower” first quarter was still impacted by Covid-19-related absenteeism, in addition to high rainfall in South Africa and Brazil, and some operational and safety challenges at the miner’s met coal and iron-ore operations.

The company is also adjusting upward its unit cost guidance for most product groups, to reflect the latest exchange rates and inflationary pressure on input prices, particularly diesel.

For the quarter ended March 31, Anglo’s iron-ore production decreased by 19% year-on-year to 13.2-million tonnes, owing to high rainfall and plant issues at the Kumba Iron Ore and Minas-Rio operations.

Full-year guidance for iron-ore has been revised down to between 60-million and 64-million tonnes, compared with the previous estimate of between 63-million and 67-million tonnes.

Met coal production was 32% lower in the quarter under review at 2.2-million tonnes, owing to the delayed longwall move at the Moranbah operation and the end of production from the Grasstree operation.

However, the suspended Grosvenor operation and Aquila life-extension project both started operations in mid-February.

Operations at the Moranbah mine have subsequently been suspended, following a fatal underground incident late in March.

Full-year guidance for met coal has been set at between 17-million and 19-million tonnes, down from the previously expected 20-million to 22-million tonnes.

Copper production also came in 13% lower year-on-year at 140 000 t for the quarter under review, mostly owing to planned lower grades, while metal-in-concentrate production from the PGM operations decreased by 6% to 956 000 oz, primarily owing to high rainfall at the Mogalakwena operation.

Full-year guidance for PGMs has been revised down to between 3.9-million and 4.3-million ounces, compared with the previously expected 4.1-million to 4.5-million ounces.

Unit cost guidance for the full-year is anticipated to increase to $105/t, compared with the previous cost guidance of $85/t, reflecting the impact of lower volumes, a stronger Australian dollar and inflation, and higher fuel costs.

On a positive note, rough diamond production increased by 25% year-on-year to 8.9-million carats in the first quarter of the year, which reflects a strong operational performance and lower rainfall impact, primarily in Botswana.

Outgoing CEO Mark Cutifani comments that progressing the company’s Sustainable Mining Plan priorities has never been more relevant or urgent, most notably those related to energy security, costs and emissions.

“During the [reporting] quarter, we partnered with EDF Renewables to secure 100% renewable energy for our operations in South Africa. This ecosystem approach is a major step towards reducing our on-site energy requirements, the largest source of our operational emissions, building on the 100% renewable electricity already secured for our South American operations by 2023.

“We also expect to have the world's largest hydrogen haul truck to be in action in the next few weeks, which will displace up to 80% of our on-site diesel emissions.”

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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