KAZ Minerals makes further production progress in the first quarter

KAZ Minerals posted its first quarter production report on Thursday, with copper production rising 3% to 67.3 kt quarter-on-quarter, which the company said was supported by higher output at Bozshakol and Aktogay sulphide.

The FTSE 250 firm said it was on track to achieve its 2018 production guidance for all metals.

At Bozshakol, it saw a 20% increase in copper production quarter-on-quarter to 26.9 kt for the three months to 31 March, supported by a 10% growth in ore throughput and improved copper recovery.

Gold output increased 29% to 36.0 koz, due to a higher gold grade and an improved recovery rate.

At Aktogay, copper production from sulphide ore increased 9% to 21.1 kt, benefitting from a higher copper grade of 0.62% and a recovery rate of 88%.

Cathode production from oxide ore was seasonally lower at 5.3 kt, down from 6.7 kt in the fourth quarter, but still 13% above the first quarter of 2017.

In the East Region and at Bozymchak, copper production was 16% lower at 14.0 kt, which the board said was due to planned idling of the Nikolayevsky concentrator.

Full year guidance of 65 kt at the project was maintained.

Byproducts remained in line with expectations, with zinc output rising 20% to 14.2 kt.

On the financial front, KAZ reported net debt of $2.21bn as at 31 March.

A total of $250m deferred from 2016 and 2017 year was paid to the Aktogay construction contractor in the quarter, the board confirmed.

“I am pleased to report further quarterly production growth in 2018 supported by higher output from the sulphide plants at Bozshakol and Aktogay,” said chief executive Andrew Southam.

“We are on track to achieve our guidance across all metals for the full year, targeting 270-300 kt of copper production and 160-175 koz of gold.

“The group is delivering production growth into a balanced market and the medium-term outlook for copper prices remains strong.”