6th Jul 2015 07:46
LONDON (Alliance News) - Sierra Rutile PLC Monday said production remains on track to meet full-year expectations and said its cash costs continue to fall.
The mineral sands producer reported "strong" production in the second quarter of 29,933 tonnes of rutile, up 28% quarter-on-quarter from 23,342 tonnes and an increase of 8% year-on-year from 27,842 tonnes.
The company said it is on track to produce between 120,000 to 130,000 tonnes of rutile in 2015.
Although rutile production improved, ilmenite production fell 68% quarter-on-quarter to 4,117 tonnes from 12,803 tonnes. Production in the second quarter was also just under half the 8,420 tonnes produced in the same period a year earlier.
"Second quarter ilmenite production was targeted to be approximately 8,000 tonnes as mining moved into areas of more conventional ratios of ilmenite to rutile than experienced in the first quarter," said Sierra Rutile.
However, it said, "given the very high ilmenite production in the first quarter of 2015, Sierra Rutile did not require as much ilmentite in the second quarter to meet its sales plan and so has stockpiled a stream of unfinished ilmenite concentrate for processing later in the year."
Ilmenite production for the full year remains on track to be in the range of 30,000 to 35,000 tonnes, the company said.
Zircon concentrate production rose 5% quarter-on-quarter to 333 tonnes from 318 tonnes, but was down 32% from the 488 tonnes produced a year earlier.
In addition, the company said its all-in operating cash cost in the second quarter was USD685 per tonne, down from USD766 per tonne in the previous quarter. Full year guidance is targeting a cost in the range of USD650 to USD670 per tonne.
"Sierra Rutile product continues to experience strong customer demand for its high-quality, premium product; however, pigment markets remain subdued. The outlook for the titanium metal and welding markets is positive, with increased volumes expected to flow into these end markets in the second half of 2015," said the company.
Sierra Rutile shares were up 4.7% to 28.00 pence on Monday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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