Better quarter for MMG

Hong Kong-listed MMG had a smoother run in the April-June quarter after a difficult start to the year, maintaining its production outlook for 2023 while trimming cost expectations at the Rosebery mine in Australia but lifting them at Kinsevere in the Democratic Republic of the Congo.
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Las Bambas control room.

The Melbourne-based company's copper production, including cathode and concentrate, was 92,847t for the three months and guidance was maintained at 305,000-353,000t.

Coming from Las Bambas (81,168t) in Peru and Rosebery (348t), MMG's copper concentrate production for the quarter was 81,516t, which is up by 153% year-on-year and a 39% improvement on January-March.

Protests stabilise in Peru

The company said Las Bambas production was up by 153% from the prior period, with mining operations at full capacity following a "return of social stability" and the highest quarterly milling throughput since 2019.

"Las Bambas concentrate transportation has remained stable since the removal of roadblocks in March, supported by the State of Emergency implemented by the government of Peru, which remained in place throughout the quarter," MMG said.

Protests in the region forced MMG to put Las Bambas on care and maintenance earlier in the year. 

The company noted that the State of Emergency has been extended for a further 30 days from July 14.

Power problems in the DRC

MMG's copper cathode production, coming from Kinsevere, stood at 11,331t in April-June, dropping 7% year-on-year and rising 10% quarter-on-quarter.

The company said the 7% year-on-year drop was mainly due to an unstable power supply from the DRC's national grid and a planned shutdown for installation work on the cobalt plant.

"Kinsevere secured more supplementary ore from third parties to offset a reduced supply of mined oxide ore, resulting in higher ore feed grade and an improved recovery rate, albeit at higher costs," it said.

C1 costs for 2023 at Kinsevere are now expected to be US$3.15-$3.35/lb, compared to the prior guidance range of $2.50-$2.80/lb.

Focus remains on safety at Dugald River

MMG's zinc production for the three months was 49,826t, which is a 63% rise year-on-year and 7% weaker quarter-on-quarter - dragged down by a fall in production at the Dugald River mine in Queensland, Australia.

Dugald River produced 36,474t, which is up 75% year-on-year and down 12% quarter-on-quarter.

"Focus remained on the safe ramp-up of operations following the restart in late March after a 34-day suspension due to the fatal incident in February. Full rates of mining and processing were achieved in May and performance of development and production drilling has been strong," MMG said.

The suspension of operations led to a zinc production guidance downgrade earlier in the year. 

Rosebery bounces back from bushfire

Meanwhile, in Tasmania, Rosebery's zinc production of 13,352t, was up both year-on-year and quarter-on-quarter by 37% and 13%, respectively, as operations recovered from effects in the first quarter from a bushfire and workforce availability, it said.

"In addition, milled ore grades were higher for both zinc (6.5% vs 6.2% for the prior corresponding period or 5.8% for the prior quarter) and by-products mainly due to mining sequence," MMG said.

"As a result of higher by-product grades and strong precious metals prices, C1 cost is expected to be at the lower end of prior guidance of $0.35-$0.50/lb," it said.

MMG's lead and molybdenum production

MMG's total lead production was 9,485t, which is up 67% year on year and 1% quarter on quarter. And its molybdenum production was 1,315t, with that having risen 40% year on year and 234% quarter on quarter, it said.