TSX- and ASX-listed Copper Mountain Mining has exceeded its revised operating plan announced on March 10, with second-quarter production of 23.9-million pounds of copper equivalent, comprising of 18.1-million pounds of copper, 7 499 oz of gold and 86 126 oz of silver.
The copper miner also managed to reduce its second quarter cash cost to $1.48/lb, compared with $1.74/lb achieved in the same period of 2019.
All-in sustaining costs (AISC) for producing copper reduced to $1.67/lb in the quarter, compared with $1.85/lb achieved in the corresponding period of 2019.
The miner increased its second quarter revenue to C$91-million, while its gross profit of C$30.3-million also increased.
Copper Mountain’s earnings a share rose to C$0.12, from C$0.01 apiece a year earlier.
Cash flow from operations also increased before working capital changes to C$41.5-million, compared to C$4.7-million in the second quarter of 2019.
During the second quarter, the miner also managed to complete its updated Eva Copper feasibility study, demonstrating improved economic and operating metrics. These include the project having an after-tax net present value of C$437-million and an after-tax internal rate of return of 29%. The study also points to total production of 1.5-billion pounds of copper over a 15-year mine life, with cash costs of $1.44/lb of copper, net of by-product credits.
Copper Mountain also completed the installation of direct flotation reactors in July, which are on schedule and on budget.
During the quarter, the Copper Mountain mine processed a total of 3.7-million tons of ore at an average feed grade of 0.28% copper, and a copper recovery of 79%, as compared with processing 3.8-million tonnes of ore at an average feed grade of 0.28% copper and a copper recovery of 78.2% in the second quarter of 2019.
Copper grade is expected to improve in the second half of 2020, as the company restarts mining in Pit #3 while maintaining lower costs. Mill availability averaged 92.5% for the second quarter of 2020, compared with 95.0% in the second quarter of 2019. The slight variance in mill availability was a result of scheduled preventative maintenance shutdowns in the quarter under review.
Copper Mountain president and CEO Gil Clausen says the company is pleased to have achieved such a strong quarter despite the global impact of the Covid-19 virus and the associated lower copper price environment. “The positive outcome was a direct result of our quick response in implementing a revised mine plan in early March, demonstrating the flexibility of the Copper Mountain mine plan and our team’s ability to adapt quickly to changing market conditions.”
More importantly, he says the company prioritised the health and safety of its employees and it has had no confirmed or presumptive cases of Covid-19 at any of its operations.
Clausen notes that with higher metal prices and lower costs, Copper Mountain’s objective is to build its cash position to enable a rapid restart of the second stage of the mill expansion project, the installation of the third ball mill.
“The first stage of our 45 000 t/d mill expansion, the installation of the direct flotation reactors, was completed in early July. The company has also maintained spending on long lead time items associated with the number 3 ball mill installation and we anticipate recommencing construction in late 2020 or early 2021.”