First Quantum Minerals Announces 2019 Preliminary Production and 2020-2022 Guidance

TORONTO, Jan. 09, 2020 (GLOBE NEWSWIRE) — First Quantum Minerals Ltd. (“First Quantum” or the “Company”) (TSX:FMtoday announced preliminary production for the three months and year ended December 31, 2019, and guidance for production, capital expenditure and costs for the years 2020 to 2022.

2019 PRELIMINARY PRODUCTION

The Company achieved its highest ever annual copper production of 702,000 tonnes, an increase of 96kt from 2018 production. Copper production in Q4 2019 was 204kt compared to 158kt in the same quarter in 2018.

Cobre Panama’s final mill (8th mill), came on line in mid-December, providing additional capacity on the third milling train.  Mill throughput can now ramp-up to annualized production of 85 million tonnes.  Mill throughput for the month of December was 6.6 million tonnes. Production for Q4 2019 was 60kt with 25kt produced in the month of December.

Kansanshi copper production for the fourth quarter was in line with the comparable period of 2018 though, as noted in Q2 and Q3 2019, lower oxide ore grades and resulting recoveries contributed to lower copper production for the year compared with 2018.

Sentinel copper production for the fourth quarter reflects lower feed grades and lower recoveries due to transitional ore mined from the east cutback of the pit which resulted in lower production compared with the comparable period of 2018.

Amounts are preliminary and subject to final adjustment. The final production figures will be provided in the Company’s financial results for the fourth quarter and year ended December 31, 2019.

000’s   Q4
  2019
Q4
2018
  Year
  2019
  Year
  2018
Copper production (tonnes)1,2 204 158 702 606
Gold production (ounces)2 78 48 257 185
Zinc production (tonnes) 3 8 18 27
Copper (000’s tonnes)1,2   Q4
  2019
Q4
2018
  Year
  2019
  Year
  2018
Cobre Panama2 60 147
Kansanshi 61 62 232 252
Sentinel 51 61 220 224
Las Cruces 18 18 48 71
Other 14 17 55 59
  204 158 702 606
Gold production (000’s ounces)2   Q4
  2019
Q4
2018
  Year
  2019
  Year
  2018
Cobre Panama2 28 60
Kansanshi 36 33 145 130
Other 14 15 52 55
  78 48 257 185

 1  Production presented on a copper concentrate basis, i.e. mine production only. Production does not include output from the Kansanshi smelter.
 2  Copper and gold production volumes include pre-commercial and commercial production from Cobre Panama. Cobre Panama was declared in commercial production from September 1, 2019.

Copper (000’s tonnes)   Q4
  2019
Q4
2018
  Year
  2019
  Year
  2018
Commercial 204 158 634 606
Pre-commercial 68
  204 158 702 606
Gold (000’s ounces)   Q4
  2019
Q4
2018
  Year
  2019
  Year
  2018
Commercial 78 48 233 185
Pre-commercial 24
  78 48 257 185

2020 – 2022 GUIDANCE

Guidance is based on a number of assumptions and estimates as of December 31, 2019, including among other things, assumptions about metal prices and anticipated costs and expenditures. Guidance involves estimates of known and unknown risks, uncertainties and other factors which may cause the actual results to be materially different.

Production guidance

000’s 2020 2021 2022
Copper (tonnes) 830 – 880 800 – 850 800 – 850
Gold (ounces) 280 – 300 280 – 300 280 – 300
Nickel (tonnes) 15 – 20 25 – 28 25 – 28

Production guidance by operation

Copper

000’s tonnes 2020 2021 2022
Cobre Panama 285 – 310 310 – 330 310 – 340
Kansanshi 220 – 235 220 – 235 220 – 230
Sentinel 230 – 240 240 – 255 250 – 260
Las Cruces 52
Other sites 43 30 20

Gold

000’s ounces 2020 2021 2022
Cobre Panama 120 – 130 125 – 135 135 – 145
Kansanshi 120 – 130 120 – 130 120 – 130
Other sites 40 35 25

Nickel

000’s tonnes 2020 2021 2022
Ravensthorpe  15 – 20 25 – 28 25 – 28

Cash cost and all-in sustaining cost

Copper ($/ lb) 2020 2021 2022
C1 1.20 – 1.40 1.20 – 1.40 1.20 – 1.40
AISC 1.70 – 1.85 1.70 – 1.85 1.70 – 1.85

Production at Ravensthorpe is expected to ramp-up through 2020.  In the first two full years of production, 2021 and 2022, C1 and all-in sustaining cost costs are expected to be between $4.60 – $4.80/lb and $5.10 – $5.40/lb respectively.

Capital expenditure

$ million 2020 2021 2022
Capitalized stripping 250 250 250
Sustaining capital and other projects 600 600 600
Total capital expenditure 850 850 850

On Behalf of the Board of Directors of First Quantum Minerals Ltd.                
G. Clive Newall
President

For further information visit our website at www.first-quantum.com

North American contact: Lisa Doddridge, Director, Investor Relations
Tel: (416) 361-3752 Toll free: 1 (888) 688-6577
United Kingdom contact: Clive Newall, President
Tel: +44 7802 721663
E-Mail: info@fqml.com

CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION

Certain statements and information herein, including all statements that are not historical facts, contain forward-looking statements and forward-looking information within the meaning of applicable securities laws. The forward-looking statements include estimates, forecasts and statements as to the Company’s expectations of production and sales volumes, and expected timing of completion of project development at Enterprise and post completion of construction activity at Cobre Panama and are subject to the impact of ore grades on future production, the potential of production disruptions (including at Cobre Las Cruces as a result of the land slippage in January 2019), capital expenditure and mine production costs, the outcome of mine permitting, other required permitting, the outcome of legal proceedings which involve the Company, information with respect to the future price of copper, gold, silver, nickel, zinc, pyrite, cobalt, iron and sulphuric acid, estimated mineral reserves and mineral resources, First Quantum’s exploration and development program, estimated future expenses, exploration and development capital requirements, the Company’s hedging policy, and goals and strategies. Often, but not always, forward-looking statements or information can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate” or “believes” or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved.

With respect to forward-looking statements and information contained herein, the Company has made numerous assumptions including among other things, assumptions about continuing production at all operating facilities, the price of copper, gold, nickel, zinc, pyrite, cobalt, iron and sulphuric acid, anticipated costs and expenditures and the ability to achieve the Company’s goals. Forward-looking statements and information by their nature are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or information. These factors include, but are not limited to, future production volumes and costs, the temporary or permanent closure of uneconomic operations, costs for inputs such as oil, power and sulphur, political stability in Zambia, Peru, Mauritania, Finland, Spain, Turkey, Panama, Argentina and Australia, adverse weather conditions in Zambia, Finland, Spain, Turkey, Mauritania and Panama, labour disruptions, potential social and environmental challenges, power supply, mechanical failures, water supply, procurement and delivery of parts and supplies to the operations, and the production of off-spec material.

See the Company’s Annual Information Form for additional information on risks, uncertainties and other factors relating to the forward-looking statements and information. Although the Company has attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements or information, there may be other factors that cause actual results, performances, achievements or events not to be anticipated, estimated or intended. Also, many of these factors are beyond First Quantum’s control. Accordingly, readers should not place undue reliance on forward-looking statements or information. The Company undertakes no obligation to reissue or update forward-looking statements or information as a result of new information or events after the date hereof except as may be required by law. All forward-looking statements and information made herein are qualified by this cautionary statement.

Source: Globe News Wire

ZESCO, CEC Stand-Off Worrisome

KALONDE NYATI, Lusaka
THE ‘divorce’ between Zesco Limited and the Copperbelt Energy Corporation (CEC) needs to be handled with caution to avoid cutting off power to the mining industry, an energy expert has said.
Johnstone Chikwanda said the two entities need to ensure a smooth transition that will not affect power supply to the mines as Zesco relies on CEC infrastructure on the Copperbelt.
At the same time, CEC will need Zesco to export electricity to the Democratic Republic of Congo (DRC) CLICK TO READ MORE 

Source: Zambia Daily Mail

Kansanshi Workers In 7% Pay Rise

Kansanshi Mine PLC has awarded its unionized workers a seven per cent salary increase across the board.

This follows the signing of the 2020 collective agreement with the Mineworkers Union of Zambia (MUZ), National Union of Miners and allied workers (NUMAW) and United Mineworkers Unions of Zambia (UMUZ).

NUMAW president James Chansa, who spoke on behalf of other unions, said the negotiations were due to the many challenges in the sector.

Chansa said the unions will work towards ensuring adherence to agreed conditions and further urged workers to continue working hard.

Meanwhile, Kansanshi Mine PLC Human Resource Manager, Maimbo Silimi said the collective agreement includes a seven per cent increase in salaries and an adjustments to the funeral grant, among other conditions.

He said the mining firm has also introduced long service awards for employees reaching five, 10 and 15 years.

Silimi said Kansanshi Mine was cognizant of the importance of its workforce, hence the adjustments to their packages.

©Zambia Reports 2020.

Source: Zambia Reports

Diamond Drilling Works in Kasenseli Area of Mwinilunga District ONB No: ZCCM-IH/002/2020

  1. ZCCM Investments Holdings Plc. has received financing from own sources toward the CAPEX for the 2020 Financial Year, and it intends to apply part of the proceeds of this financing to payments under the Contract for the Diamond Drilling Works in Kasenseli Area of Mwinilunga District of North Western Province; Contract No.: ZCCM-IH/002/2020.
  2. ZCCM Investments Holdings Plc now invites sealed bids from eligible and qualified bidders for the Diamond Drilling Works in Kasenseli Area on Mwinilunga District. The duration of the works is 20 weeks.
  3. Bidding will be conducted through the Open National Bidding (ONB) procedures specified in the Public Procurement Act of 2008 and the Public Procurement Regulations of 2011 and is open to all bidders from Eligible Source Countries as defined in the Bidding Documents. The following CEEC preferential treatment shall be applied as part of the evaluation:
    1. Citizen-influenced company – 4%
    2. Citizen-empowered company – 8%
    3. Citizen-owned company – 12%
  4. Interested eligible bidders may obtain further information from the address below and inspect the Bidding Documents at this address from 08:00 – 13:00 and 14:00 – 17:00 local time, Monday to Friday inclusive.
  5. Qualifications requirements include:
    1. Experience as a prime contractor in the rehabilitation of at least two (02) contracts of a similar nature and scope in the last five (05) years;
    2. A minimum amount of liquid assets and/or credit facilities of ZMW5,661,310.00;
    3. Average Annual Turnover for the past three (03) years of ZMW73,597,035.00.
  6. A complete set of Bidding Documents in English may be purchased by interested bidders ON THE SUBMISSION OF A WRITTEN APPLICATION to the address below and upon payment of a non-refundable fee of Zambian Kwacha Five Hundred (ZMW500.00). The method of payment will be either by Cash or Bank Certified Cheque.
  7. The address referred to above is:
    K D Kabwe (Mrs.)
    ZCCM Investments Holdings Plc.
    ZCCM-IH Office Park, Stand No. 16806
    Alick Nkhata Road, Mass Media Complex Area
    Lusaka, Zambia
    Tel: +260-211-388000
    E-mail: kabwek@zccm-ih.com.zm
  8. Bids must be delivered to the address below at or before 10:00 hours on Thursday, 6th February 2020. Electronic bidding shall not be permitted. Late bids will be rejected. Bids will be opened physically in the presence of the bidders’ representatives who choose to attend in person at the address below immediately after 10:00 hours on 6th February 2020.  All bids must be accompanied by a Bid Securing Declaration.
  9. There will be a site visit and pre-bid conference as follows:
    Date: Wednesday, 22nd January 2020
    Time: 11:00 hours
    Place: Kasenseli Area in Mwinilunga District. All Bidders to meet at the DC’s Office in Mwinilunga District at 10:00 hours.
  10. The address referred to in clause 8 is:
    K D Kabwe (Mrs.)
    ZCCM Investments Holdings Plc.
    ZCCM-IH Office Park, Stand No. 16806
    Alick Nkhata Road, Mass Media Complex Area
    Lusaka, Zambia
    Tel: +260-211-388000
    E-mail: kabwekd@zccm-ih.com.zm

ZESCO’s Termination of CEC Bulk Supply Questionable – Energy Experts

A GROUP of energy experts has questioned Zesco’s motive behind the refusal to renew a Bulk Supply Agreement it entered into with the Copperbelt Energy Corporation (CEC) over 22 years ago.

On November 21, 1997, Zesco Limited and CEC entered into an agreement where the former was supplying power to the latter at wholesale, a deal that comes to an end on March 31 this year.

Since then, CEC has been supplying power to mining companies on the Copperbelt, as well as most mining residential areas.

The company is also the major financier of the Zambian premier league side Power Dynamos Football Club.

Last Friday, CEC informed its shareholders that energy minister Mathew Nkhuwa had notified management that the agreement would not be extended once it expires at the end of March.

Responding to the government’s decision, the Energy Advisory and Solicitation Institute (EASI) argued that CEC was already proven to be a responsible stakeholder in the energy sector.

EASI chairperson Chisakula Kaputu said the motive behind the government’s refusal to renew the agreement with CEC was highly questionable.

“Zesco has since the post 2000 commercialisation narrative still remained in the doldrums of a social enterprise with very little to show of a financially sustainable business model existing,” he said in a statement yesterday.
“…EASI believes that we have an energy sector at crossroads with pertinent issues of cost reflective tariffs, Electricity Supply Industry (ESI) sustainability and viability, reform uncertainty, legacy PPAs and BSAs, energy security, etc at the fore, as such transparency and good intent is demanded of all the energy sector players/stakeholders.”

Kaputu demanded clarification from the PF government on what he termed as an ambiguous statement.
He stated that both Zesco and CEC were key stakeholders in the energy sector, hence the need for the government to reflect on the decision.

“The energy sector needs CEC as an already proven key stakeholder and only second to Zesco in functional responsibility in the power generation, transmission, distribution and supply portfolios. The energy sector needs Zesco the most as sole owner of 66 per cent of national installed capacity and over 30,000 km of transmission and distribution national grid as well as custodian of [the] National Control Centre/systems operator functionality,” stated Kaputu. “Government’s decision on the nearing expiring ZESCO – CEC BSA must be taken in the best interest of the country and energy sector above all else. Ambiguity around the bold statement that the ZESCO-CEC BSA ‘will not be renewed’ after it expires on 31st March 2020 needs to be clarified at the earliest opportunity. In order to calm the anxiety of the mining load owners and Copperbelt Province energy users in general, the discussion/negotiation around the ZESCO-CEC BSA issue needs to be expedited with resolution made way ahead of the expiry date of 31st March 2020.”

According to a notice to shareholders, the government, through Nkhuwa and Zesco, had notified CEC that the Bulk Supply Agreement would not be renewed once it expired.

“In accordance with Section 81(1) of the Securities Act No. 41 of 2016, the Board of Directors of Copperbelt Energy Corporation Plc (“CEC” or “the Company”) advises the Company’s shareholders, and the market, that the power purchase agreement or Bulk Supply Agreement (“BSA”) between CEC and ZESCO Limited (“ZESCO”), entered into on 21 November 1997 is expected to come to an end on 31 March 2020,” company secretary Julia Chaila stated. “The Government of the Republic of Zambia (“GRZ”), through the Minister of Energy, and Zesco have notified CEC of their position that the BSA will expire on the date stated above and will not be renewed. GRZ and Zesco have expressed to CEC their commitment to continue facilitating an efficient and economic supply of power to consumers on the Copperbelt both during the validity of and post the BSA. CEC wishes to emphasise its unwavering commitment to use its infrastructure and capabilities in ensuring continued and seamless supply of power to all consumers on the Copperbelt now and after the BSA.”

Source: The Mast

Agarwal Mining Group Hit by Commodity Price Slump

Anil Agarwal’s mining group has reported a drop in half-year profits due to lower commodity prices.

Vedanta Resources, which was taken private by the Indian tycoon in 2018, said that earnings before interest, depreciation, taxation and amortisation fell 19 per cent to $1.4 billion in the six months to September. Revenues fell 5 per cent to $6.1 billion, mainly because of lower prices.

Vedanta Resources has operations in India, Africa and Australia, employing 65,000 people. It listed in London in 2003 but remained controlled by Mr Agarwal, 65. In 2018 Volcan Investments, his family trust, bought back the listed third of its shares.

Vedanta said that profits in its largest business, zinc, fell by 20 per cent to $479 million in the six months to…

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Source: The Times (UK)

Kansanshi Miners in Pay Rise

KALONDE NYATI, Lusaka
UNIONISED workers at Kansanshi Mining Plc have been awarded a seven percent salary increment effective today.
Kansanshi Mining Plc human resources manager Maimbo Silimi said the increment will go a long way in cushioning the cost of living.
Speaking during the signing ceremony in Lusaka yesterday, Mr Silimi said the increment has been awarded despite the operational challenges affecting the mining firm  CLICK TO READ MORE 

Source: Zambia Daily Mail

Serenje Set for Manganese Mining

KALONDE NYATI, Lusaka
MINING of manganese at Kabundi Mining Resources Limited will get underway soon after approval around community resettlement is concluded by the Zambia Environmental Management Agency (ZEMA), Zambia Consolidated Copper Mines -Investment Holdings (IH) said.
The K70 million project located in Serenje, and is a subsidiary of ZCCM-IH, will help to unlock the manganese potential thus enable the country to benefit from the increasing global demand for the commodity used in steel production and batteries CLICK TO READ MORE 

Source: Zambia Daily Mail

Bank of Zambia to Buy 40,000 Kilos of Gold in 2020

Government, through the Bank of Zambia (BoZ), will buy and collect more than 40,000 kilogrammes of gold from primary and secondary sources, including artisanal and small-scale gold miners, Mines Permanent Secretary Barnaby Mulenga has announced.

And ZCCM-IH chief executive officer Mabvuto Chipata has disclosed that the institution has embarked on a programme to set up gold-buying centres in strategic panning areas.

Speaking during a press briefing in Lusaka, Thursday, Mulenga said the government was in dire need of liquid cash and that as such, gold mining licenses of companies that had not yet commenced operations would be revoked.

“The information generated will facilitate delineation of areas into gold panning, artisanal, small or large-scale. Large-scale areas will be reserved for government to license. On the other hand, reserves and river beds will be allocated or licensed to panners and artisan miners. Revoking non-compliant licenses in the targeted areas in public interest pursuant to section 72 (l) (i) of the Mines and Minerals Development Act of 2015. We need the money, as government, so what are they waiting for? Those who have not commenced operations will lose their licences,” Mulenga cautioned.

“Compelling existing small and large-scale mining companies to account for the gold from their mining operations, implementing measures to curb illegal exploitation of gold and means of accounting for the gold to raise revenue for the government. Other measures include: sensitization of local communities to ensure success of the strategy. The strategy requires a multi-sectoral approach to ensure that all ministries cooperate to account for the gold. The target amount of gold to be collected, as we’ve said by 2020, is 40,000Kgs. And this will come from primary sources and secondary sources that include artisanal and small-scale gold miners. And this is achievable through a well-coordinated approach; that is why we have mandated ZCCM-IH to drive this strategy, working with various partners and stakeholders.”

He said Zambia currently had more than 21 districts with deposits of gold at varying quantities.

“There are currently 21 districts with active gold mining activities, which include: Solwezi; Mwinilunga; Kasempa; Mumbwa; Kabwe; Chisamba; Senga Hills; Mpika; Chilanga; Chadiza; Chirundu; Kazungula; Lundazi; Chongwe; Petauke; Lusangazi; Vubwi; Luano; Rufunsa; Chipata; Mkushi and Serenje. More and more districts are discovering that there is gold in their areas because Zambia is not full or 100 per cent geologically mapped, but rather stands at about 62 per cent,” said Mulenga.

“Computation of estimates of the gold that could be bought off/collected can only be realized with an aggressive approach towards harnessing the artisanal miners in Zambia. We also want our people to derive value from their hard work and not the manner in which they are being exploited by unscrupulous people. This approach will help uplift the living standards of our people, who are currently panning for gold, and improve their local economies in a sustainable and environmentally friendly manner. And that’s where ZCCM-IH comes in.”

And Chipata said the institution was in the process of forming a Special Purpose Vehicle (SPV) that would oversee the operations of all gold-related operations.

He outlined that ZCCM-IH had since embarked on a programme to set up gold-buying centres in strategic panning areas.

“We are in the process of forming a Special Purpose Vehicle that will oversee and undertake all gold-related projects. The name of this vehicle is yet to be announced. Once these results are out, we will continue with the exploration programme, particularly for the primary source of the gold in Kasenseli. This exploration for primary gold source will be happening in tandem with preparatory works for us to commence mining within 2020 once statutory approvals are finalized. Second, as one of the steps towards the formalization of the artisanal and small-scale gold miners. ZCCM-IH has embarked on a programme to set-up gold buying centres in strategic gold panning areas. We have since obtained a mineral trading permit to this effect to enable us carry out this programme. The initial sites include: Rufunsa; Vubwi; Luano; Petauke; Senga Hill and Mumbwa, and will be rolled out to other areas in the country with gold occurrences,” Chipata explained.

He added that ZCCM-IH was working in collaboration with the Ministry of Mines to formalize artisanal gold mines with the objective of curbing illegal mining activities.

“The main objective is to curb the smuggling of gold out of the country; provide an open market and competitive prices for the artisanal gold miners, and ultimately, take stock of the gold output from artisanal miners. Third, aside from this gold-buying programme, we are also working towards formalization of artisanal gold miners in collaboration with the Ministry of Mines and other stakeholders…So far, cooperatives have been registered in some areas such as Rufunsa and Petauke, and these will be given artisanal licences within the licence areas to be granted and managed by ZCCM-IH. As you have witnessed already, there has been a lot of environmental damage in gold panning and mining areas. So, the first step will be to undertake some environmental remediation exercise and this will be done through our environmental and technical services subsidiary, Misenge. We will further provide technical expertise to the artisanal gold miners with regards to mine planning, safety, among others,” said Chipata.

Source: News Diggers