KAZ Minerals meets full-year copper guidance precisely

KAZ Minerals posted its production report for the fourth quarter and full year to 31 December on Thursday, with its full year copper guidance met and by-product guidance exceeded in 2016.

The FTSE 250 company reported copper cathode equivalent production of 140 kt, against guidance of 135-145 kt.

Copper output growth was 73% year-on-year.

New projects at Bozshakol and Aktogay contributed 63 kt of new copper cathode equivalent production in 2016, the board said, with total Q4 copper cathode equivalent production of 43 kt, down from 45 kt in Q3.

Bozshakol had a copper cathode equivalent output of 20 kt in Q4, improving from 17 kt in the prior quarter, with the project’s ramp-up on track as ore throughput averaged above 75% in the quarter.

The project produced a total 50 kt of copper in concentrate and 45 kt copper cathode equivalent in 2016.

Aktogay’s oxide output in Q4 was 6 kt, with full year copper cathode output of 18 kt.

The company said testing was in progress atits main sulphide concentrator, for first copper production in Q1 2017.

At the East Region and Bozymchak, Q4 copper cathode equivalent output was 17 kt, down from 21 kt in the third quarter - though the board said Q3 output benefited from a release of work in progress.

KAZ said its by-product output exceeds full year guidance ranges, wth sronger than anticipated by-product grades in the East Region in Q4, while Bozymchak operated at design capacity throughout 2016.

Bozshakol’s 2016 gold bar equivalent output of 60 koz was supported by elevated gold grades, it added.

“I am pleased that we have achieved our copper and by-product guidance for 2016, a 73% increase in copper output on the prior year, as we successfully ramped up Bozshakol and the Aktogay oxide plant,” said chief executive Oleg Novachuk.

“Operating costs at Bozshakol have temporarily benefited from lower than anticipated maintenance requirements during the ramp up period, and full year gross cash costs are expected to be in the region of 20% below the bottom of the previously guided range of 140-160 USc/lb.

“Our growth will continue in 2017 as Bozshakol reaches capacity and we commence production from sulphide ore at Aktogay.”