PERTH (miningweekly.com) – Copper miner Sandfire Resources has reported a significant surge in production during the March quarter, following the completion of the MATSA mining operation, in Spain, and an operational integration programme.

Copper production in the March quarter increased to 28 774 t, up from the 18 675 t produced in the December quarter, while a further 16 027 t of zinc and 1 901 t of lead were also produced for the first time in the March quarter.

Gold production in March declined slightly to 6 956 oz, from the 8 739 oz produced in the December quarter, while 620 000 oz of silver were also produced for the first time.

The DeGrussa mine, in Western Australia, accounted for 16 238 t of the copper produced in the March quarter, along with all of the gold production and 68 825 oz of silver.

MATSA, for its part, contributed 12 536 t of copper, all of the zinc and lead production, as well as 551 011 oz of silver.

“The March quarter was a transformational period for Sandfire. The completion of the MATSA acquisition, its successful and rapid integration into our business, and the excellent progress we are making with construction at Motheo, signal the start of an exciting new era of growth for our business,” said MD and CEO Karl Simich.

“We are pleased to confirm the ongoing successful integration of the MATSA operation, after receiving the keys on February 1, and I would like to take this opportunity to acknowledge the professionalism of our teams in Spain and Australia for the seamless way in which this has been achieved. We are very proud to be the new owners and operators of this world-class base metal asset, which will underpin our company’s growth for many years to come.

“MATSA has made a strong initial contribution to the group’s production, which is in line with expectations and, combined with another robust performance at DeGrussa, puts us on track to achieve our updated Group production guidance for 2022,” said Simich.

“The pressures of global cost inflation combined with the ongoing consequential impacts of Covid-19 transmission, remain significant challenges for the resource sector globally. Sandfire is not immune from these challenges and, as a result, we have increased our C1 unit cost guidance for 2022.”

For the full 2022, Sandfire has estimated a C1 cost of $1.19/lb.

“While cost inflation and rising energy costs in Europe are undeniable challenges, it’s important to remember that these same cost pressures are helping to drive up the prices for the metals we produce, many of which are at multi-year or all-time highs. This means that we are generating very healthy earnings before interest, tax, depreciation and amortisation (Ebitda) cash-flow margins across the expanded business – as reflected in the strong sales revenue, Ebitda and operating cash-flows reported for the quarter. This provides investors with some insights into the increased depth and financial capability of the expanded Group moving forward,” said Simich.

Meanwhile, he told shareholders that Sandfire also made progress with its Motheo copper mine, in Botswana, during the quarter under review. A definitive feasibility study on the project expansion remains on schedule for completion in the June quarter.

“We have been able to keep the project schedule on track and on budget despite the global labour and supply challenges. A number of important milestones were achieved, culminating in the start of openpit mining towards the end of the quarter,” Simich said.

“We are executing our growth strategy against one of the most remarkable periods ever seen in commodity markets. The combination of soaring demand from the renewable energy sector, years of underinvestment in new mine development and, more recently, the impacts of supply chain disruptions have seen inventories of many base metals fall to the lowest levels on record.”