24th Jan 2019 08:24
LONDON (Alliance News) - London- and Johannesburg-listed miner Anglo American PLC on Thursday reported a rise in most of its production for 2018, but it expects to see a drop in production for 2019.
Total production on a copper equivalent basis for the fourth quarter of 2018 rose by 7% year-on-year, excluding the impact of the Minas Rio stoppage in Brazil due to pipeline leaks.
For 2018, copper production was up 15% to 668,000 tonnes from 579,000 tonnes in 2017, reflecting increases in all Anglo American's copper operations.
The miner's copper guidance for 2019 was 630,000 to 660,000 tonnes, which would be a decrease from 2018.
Diamond production from the group's De Beers business rose by 6% to 35.3 million carats from 33.5 million carats, due to higher production from the Orapa mine in Botswana.
Due to the eventual exiting of the Venetia open pit, however, Anglo American said it expects diamond production to come in lower from 2018, in the range of 31 million to 33 million carats.
In Anglo American's coal operations, metallurgical coal saw a rise in production by 11% to 21.8 million tonnes from 19.7 million tonnes in 2017 due to increases in all its operations.
Thermal coal, however, declined by 2% to 28.6 million tonnes from 29.2 million tonnes due to bad weather conditions in Anglo American's Colombia operations.
Anglo American was slightly more positive in its expectations for coal production in 2019, with metallurgical coal expected in the range of 22 to 24 million tonnes, and thermal coal between 26 to 28 million tonnes.
Iron ore production was restarted at Minas-Rio in Brazil in December since being suspended in March 2018 due to pipe leakages.
Production from Minas-Rio was 3.4 million tonnes in 2018, down from 16.8 million tonnes the year before; however Anglo American remains confident for Minas Rio production for 2019.
Production guidance for Minas-Rio's 2019 is set in the range of 18 million to 20 million tonnes.
"Our continuing focus on efficiency and productivity improvements across the business resulted in another strong quarter, adding to our consistent track record of delivery," said Anglo American Chief Executive Mark Cutifani.
"We ended this successful quarter with the restart of operations at Minas-Rio and receipt of a key approval relating to the important Step 3 licence area that supports its increase in production towards design capacity," Cutifani added.
Shares in Anglo American were down 1.1% at 1,781.00 pence in London, and 1.1% lower at ZAR321.10 in Johannesburg.
Anglo American's subsidiary, Anglo American Platinum Ltd also reported a rise in production in 2018, but also expects to see a decrease in 2019.
Total platinum group metals production for 2018 climbed up 4.0% to 5.2 million ounces from 5.0 million ounces in 2017, due to stronger performances across its platinum and palladium operations.
Amplats's platinum production increased by 4% to 2.48 million ounces from 2.40 million ounces, and palladium production rose by 3% to 1.61 million ounces from 1.58 million ounces.
However, Amplats said it expects to see lower PGM production in 2019 at between 4.2 million and 4.5 million ounces, due to the transition of Sibanye Gold Ltd material to a tolling agreement in place of concentrates purchased.
Amplats's shares were down 1.2% at ZAR585.27 on Thursday in Johannesburg.
Kumba Iron Ore Ltd, another subsidary of Anglo American, saw a fall in its sales and production of iron ore for the year in line with expectations, due to rail constraints and logisitical challenges.
Production for 2018 fell by 4% to 43.1 million tonnes from 45.0 million tonnes in 2017, as the Sisken mine declined in production while the Kolomela mine remained flat.
In addition, sales dipped by 4% to 43.3 million tonnes from 45.9 million tonnes, as export sales dropped in the year while domestic sales remained largely flat.
Kumba Iron Ore shares were down 2.1% at ZAR278.21 in Johannesburg.
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