https://www.miningweekly.com

MMG sees copper output sink 20% in Q1, confirms Peru force majeure

24th April 2020

By: Reuters

  

Font size: - +

MMG Ltd said on Thursday its copper output fell 20% year-on-year in the first quarter because of lower-than-planned production at the Las Bambas mine in Peru, where the miner has declared force majeure because of coronavirus-related curbs.

Las Bambas is among the world's biggest copper mines and one of the major mining projects that has cut production, prompting Australia-based MMG to formally withdraw its full-year production guidance for the mine earlier this month.

Company-wide copper production for the three months ended March 31 totalled 91,911 tonnes, MMG - which is majority-owned by China Minmetals Corp - said in a filing to the Hong Kong stock exchange, down from 114,369 tonnes a year earlier.

At Las Bambas, production of copper in concentrate slipped 28% year-on-year to 73,319 tonnes.

MMG said this was lower than planned because of repairs on an overland ore conveyor and local community blockades that impacted logistics, but the greatest disruption since mid-March has been because of the novel coronavirus, which has seen Peru declare a state of emergency to contain the spread.

Concentrate shipments "have been adversely impacted and are suspended," while stocks at the port of Matarani are exhausted, MMG said.

"As a result, force majeure has been declared on Las Bambas copper and molybdenum concentrate sales agreements," it added, noting all cargoes shipped overseas during the quarter had been received without any major interruptions.

Activating the force majeure clause allows certain terms of an otherwise legally binding agreement to be ignored because of unavoidable circumstances. Reuters reported the MMG force majeure on April 9.

Output of minor metal molybdenum at Las Bambas plunged 76% year-on-year in the first quarter to 124 tonnes, which MMG attributed to debottlenecking work on the molybdenum plant.

It did not give a revised production forecast for Las Bambas but said it was "working on a range of scenarios for recovery once restrictions have lifted" and will provide an update once there is greater certainty.

The company said it continues to expect Las Bambas to produce around 2 million tonnes of copper over the five-year period from 2021 to 2025.

MMG's zinc output - at the Dugald River mine in Queensland and Rosebery deposit in Tasmania - was down 7% year-on-year in the first quarter at 52,957 tonnes but within expectations, the company said. Lead production fell 9% to 9,943 tonnes.

MMG is for now retaining previous full-year output guidance for those projects, as well as for its Kinsevere copper mine in the Democratic Republic of Congo

Edited by Reuters

Comments

The content you are trying to access is only available to subscribers.

If you are already a subscriber, you can Login Here.

If you are not a subscriber, you can subscribe now, by selecting one of the below options.

For more information or assistance, please contact us at subscriptions@creamermedia.co.za.

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION