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Anglo American Production Report Q1, 2017

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By LSE RNS

RNS Number : 0539D
Anglo American PLC
24 April 2017
 

 

 

 

 

 

NEWS RELEASE

 

24 April 2017

 

Anglo American plc

Production Report for the first quarter ended 31 March 2017

 

http://www.rns-pdf.londonstockexchange.com/rns/0539D_-2017-4-21.pdf

 

Overview

 

 

Q1 2017

Q1 2016

% vs. Q1 2016

Diamonds (Mct)(1)

7.4

6.9

8%

Platinum (produced ounces) (koz)(2)

572

567

1%

Copper (t)(3)(4)

142,600

146,500

(3)%

Iron ore - Kumba (Mt)

10.5

8.9

17%

Iron ore - Minas-Rio (Mt)(5)

4.3

3.3

30%

Export metallurgical coal (Mt)

5.2

4.1

28%

Export thermal coal (Mt)(6)

6.8

6.5

6%

Nickel (t)(7)

9,900

11,200

(12)%

 

Mark Cutifani, Chief Executive of Anglo American, said "A strong operational performance enhanced by the continued ramp-up of Gahcho Kué, Minas-Rio and Grosvenor delivered an 9% increase in production on a copper equivalent basis(8). The operating improvements at Sishen and ongoing portfolio refinements are further strengthening Anglo American's resilience and competitive position. De Beers' total sales volumes of 14.1 million carats reflected improved demand for lower value goods in stock at 31 December 2016."

  • Rough diamond production increased by 8% to 7.4 million carats compared with Q1 2016. This reflected the contribution of Gahcho Kué in Canada, as well as increases in response to improved trading conditions.
  • Platinum production (metal in concentrate)(2) was broadly flat at 572,000 ounces. With the sale of Rustenburg, production from that operation is now treated as purchase of concentrate (which increased by 93%) rather than own mined production (which decreased by 26%). Refined platinum production increased by 121% to 577,000 ounces as Q1 2016 was impacted by a Section 54 safety stoppage at the Precious Metals Refinery.
  • Copper production decreased by 3% to 142,600 tonnes. Continued strong performance at Collahuasi was offset by expected lower grades and increased ore hardness at Los Bronces, and the temporary suspension of mining operations at El Soldado which resulted in ~3,000 tonnes of lost production.
  • Iron ore production from Kumba increased by 17% to 10.5 million tonnes due to improved mining productivity at Sishen, and higher throughput at Kolomela.
  • Iron ore production from Minas-Rio increased by 30% to 4.3 million tonnes (wet basis) as the operation continued to ramp-up.
  • Export metallurgical coal production increased by 28% to 5.2 million tonnes, primarily due to a longwall move at Moranbah in Q1 2016 and the ramp-up at Grosvenor.
  • Production of South African and Colombian export thermal coal increased by 6% to 6.8 million tonnes, driven by higher productivity across most of the South African mines.
  • Nickel production decreased by 12% to 9,900 tonnes due to unplanned maintenance of Barro Alto's electric furnaces, impacting throughput.

 

(1) De Beers production on 100% basis except the Gahcho Kué joint venture which is on an attributable 51% basis; (2) Reflects own mine production and purchases of metal in concentrate; (3) Copper production from the Copper business unit; (4) Copper production shown on a contained metal basis; (5) Wet basis; (6) Export thermal coal includes export primary production from South Africa and Colombia, and excludes secondary South African production that may be sold into either the export or domestic markets; (7) Nickel production from the Nickel business unit; (8) Copper equivalent production is normalised for, Kimberley, Niobium & Phosphates, Foxleigh and Callide, and to reflect Snap Lake being placed on care and maintenance, and the closure of Drayton.

DE BEERS

 

 

 

Q1 2017

Q1 2016

Q1 2017 vs. Q1 2016

Q4 2016

Q1 2017 vs. Q4 2016

Diamonds(1)

 

 

 

Debswana

000 carats

           5,191

           5,328

(3)%

           5,440

(5)%

Namdeb Holdings

000 carats

              472

              444

6%

              428

10%

DBCM

000 carats

           1,106

              932

19%

           1,387

(20)%

De Beers Canada

000 carats

              631

              162

290%

              497

27%

Total carats recovered

000 carats

           7,400

           6,866

8%

           7,752

(5)%

 

De Beers - Rough diamond production increased by 8% to 7.4 million carats, reflecting the contribution of Gahcho Kué in Canada, as well as increases in response to improved trading conditions.

 

Debswana's (Botswana) production decreased marginally to 5.2 million carats. Jwaneng's, production decreased by 8% due to expected lower grades, partly offset by Orapa, which increased by 5% due to expected higher grades.

 

Production at Namdeb Holdings (Namibia) increased by 6% to 0.5 million carats due to marginally higher grade at Namdeb.

 

In DBCM (South Africa), production increased by 19% to 1.1 million carats largely as a result of higher grades at Venetia.

 

Production in Canada increased by 290% to 0.6 million carats due to the contribution of Gahcho Kué, which reached commercial production on 2 March 2017.

 

Total rough diamond sales volumes in Q1 2017 were 14.1 million carats (13.7 million carats on a consolidated basis(2)) from three Sights, compared with 8.1 million carats (7.6 million carats on a consolidated basis(2)) from two Sights in Q1 2016. In addition, this increase reflected stronger demand in Sight 1 2017, particularly for lower value goods in stock at 31 December 2016.

 

Full Year Guidance

Full year production guidance(1) remains unchanged at 31-33 million carats, subject to trading conditions.

 

 

(1)    De Beers production is on a 100% basis, except for the Gahcho Kué joint venture which is on an attributable 51% basis.

(2)    Consolidated sales volume excludes De Beers' JV partners' 50% proportionate share of sales to entities outside the De Beers Group of Companies from the Diamond Trading Company Botswana and the Namibia Diamond Trading Company, and includes pre-commercial production sales volumes from Gahcho Kué.

 

 

 

De Beers

Q1 2017

Q4 2016

Q3 2016

Q2 2016

Q1 2016

Q1 2017

vs.

Q1 2016

Q1 2017 vs.

Q4 2016

Carats recovered

(000 carats)

 

 

 

 

 

 

 

100% basis (unless otherwise stated)

 

 

 

 

 

 

 

    Orapa

                2,106

           2,366

            1,536

           2,028

            2,001

5%

(11)%

Letlhakane

                    130

                135

                176

                159

                125

4%

(4)%

Damtshaa(1)

                                -  

                           -  

                           -  

                           -  

                           -  

-

-

Jwaneng

                2,955

           2,939

           2,837

           2,997

           3,202

(8)%

1%

Debswana

         5,191

    5,440

    4,549

    5,184

    5,328

(3)%

(5)%

 

 

 

 

 

 

 

 

Namdeb

                      94

                118

               120

                 94

                 72

31%

(20)%

Debmarine Namibia

                   378

               310

               285

              202

               372

2%

22%

 

Namdeb Holdings

          472

      428

       405

      296

      444

6%

10%

 

 

 

 

 

 

 

 

Kimberley

                                -  

                           -  

                           -  

                           -  

                 68

(100)%

-

Venetia

                     939

             1,218

              898

               695

               706

33%

(23)%

Voorspoed

                    167

               169

               196

               126

                158

6%

(1)%

DBCM

          1,106

    1,387

    1,094

       821

      932

19%

(20)%

 

 

 

 

 

 

 

 

Snap Lake

                                -  

                           -  

                           -  

                           -  

                   3

(100)%

-

Victor

                     189

               148

               142

                147

                159

19%

28%

Gahcho Kué (51% basis)

                     442

              349

                 83

                           -  

                           -  

-

27%

 

De Beers Canada

          631

       497

       225

       147

       162

290%

27%

Total carats recovered

7,400

7,752

6,273

6,448

6,866

8%

(5)%

Sales volumes

 

 

 

 

 

 

 

Total sales volume

(100%) (Mct)(2)

14.1

8.0

5.7

10.2

8.1

74%

75%

Consolidated sales volume (Mct)(2)(3)

13.7

7.5

5.3

9.6

7.6

80%

82%

Number of Sights

(sales cycles)

3

3

2

3

2

 

 

 

(1)    Damtshaa (a satellite operation of Orapa) was placed on care and maintenance from 1 January 2016).

(2)    Consolidated sales volumes exclude De Beers' JV partners' 50% proportionate share of sales to entities outside the De Beers Group of Companies from the Diamond Trading Company Botswana and the Namibia Diamond Trading Company, which are included in total sales volume.

(3)    Consolidated sales volume includes pre-commercial production sales volumes from Gahcho Kué.

 

 

 

PLATINUM

 

Platinum

 

Q1 2017

Q1 2016

Q1 2017

vs.

Q1 2016

Q4 2016

Q1 2017

vs.

Q4 2016

Produced ounces

000 oz

572

567

1%

610

(6)%

   Own mined

000 oz

325

439

(26)%

387

(16)%

   Purchase of concentrate

000 oz

247

128

93%

223

11%

Refined

 

 

 

 

 

 

   Platinum

000 oz

577

261

121%

632

(9)%

   Palladium

000 oz

353

182

95%

397

(11)%

   Rhodium

000 oz

74

48

55%

92

(20)%

   Gold

000 oz

25

28

(11)%

34

(27)%

   Nickel

t

5,100

5,700

(11)%

6,200

(18)%

   Copper

t

3,200

3,300

(3)%

3,300

(3)%

 

 

Platinum - Platinum production (metal in concentrate) was broadly flat at 572,000 ounces. With the sale of Rustenburg, which completed in November 2016, production from that operation is now treated as purchase of concentrate (which increased by 93%) rather than own mined production (which decreased by 26%).

 

Own mined production

Mogalakwena production increased by 3% to 111,900 ounces as a result of stronger plant recoveries and increased throughput.

 

Amandelbult production decreased by 12% to 97,100 ounces primarily due to unusually heavy rainfall resulting in flooded open pits, which also impacted feed chutes to the concentrator plants, as well as minor industrial action which impacted production for two days.

 

Union increased production by 10% to 37,700 ounces due to improved crew efficiencies and mining closer to the shaft area in line with the optimised mine plan. The sale of Union to Siyanda Resources was announced on 15 February. The sale is expected to complete during 2017, after which Siyanda will sell concentrate produced by Union to Platinum for a period of seven years and thereafter Platinum will toll treat concentrate for the remaining life of Union.

 

Mined production from independently managed operations decreased by 3% to 59,000 ounces primarily due to lower production at Kroondal following a two-day illegal strike, and lower grade at both Kroondal and Mototolo. This was partially offset by higher production at Modikwa due to improved plant recoveries.

 

Purchase of concentrate

Purchase of concentrate from independently managed operations was flat at 123,700 ounces as increased production at BRPM offset lower production at Bokoni following a fatality and subsequent Section 54 safety stoppage, as well as the 3% decrease from Modikwa, Mototolo and Kroondal described above.

 

Purchase of concentrate from third parties increased by nearly 120,000 ounces largely due to the inclusion of concentrate from Rustenburg, following the sale of these operations to Sibanye in November 2016.

 

Refined production

Refined platinum production increased by 316,100 ounces to 576,900 ounces with Q1 2016 refined production having been materially impacted by a Section 54 safety stoppage at the Precious Metal Refinery.

 

Following the Waterval smelter run-out in Q3 2016, the Number 1 furnace was successfully rebuilt in  Q4 2016 and is now running at steady-state; the backlog of 65,000 ounces is expected to be processed during 2017. The Number 2 furnace underwent planned maintenance and has now been successfully rebuilt. It is ramping-up to full capacity, which is expected in Q2 2017.

 

 

Full Year Guidance

Full year production guidance of metal in concentrate remains unchanged at 2.35 - 2.40 million ounces.

 

Platinum

Q1 2017

Q4 2016

Q3 2016

Q2 2016

Q1 2016

 

Q1 2017

vs.

Q1 2016

Q1 2017

vs.

Q4 2016

Produced platinum

(000 troy oz)

571.9

610.0

619.1

585.7

567.0

1%

(6)%

Owned mined

324.6

386.8

468.3

443.5

439.1

(26)%

(16)%

Mogalakwena

111.9

103.4

100.7

98.8

109.0

3%

8%

Amandelbult

97.1

121.1

128.3

106.2

110.9

(12)%

(20)%

Unki

18.9

19.9

18.2

17.8

18.6

2%

(5)%

Independently managed mines(1)

59.0

60.1

64.9

66.8

60.9

(3)%

(2)%

Union

37.7

38.1

37.7

41.2

34.3

10%

(1)%

    Rustenburg(2)

-                  

44.2

118.1

110.8

104.3

(100)%

(100)%

Other(3)

-

-

0.4

1.9

1.1

(100)%

-

Purchase of concentrate

247.3

223.2

150.8

142.2

127.9

93%

11%

Independently managed mines(1)

123.7

129.3

142.2

136.4

124.2

-

(4)%

Third party purchase of concentrate(2)

123.6

93.9

8.6

5.8

3.7

3241%

32%

 

 

 

 

 

 

 

 

Refined production

 

 

 

 

 

 

 

Platinum (000 troy oz)

576.9

631.6

694.6

747.6

260.8

121%

(9)%

Palladium (000 troy oz)

353.4

397.4

412.9

472.3

181.6

95%

(11)%

Rhodium (000 troy oz)

73.7

92.2

86.8

90.7

47.7

55%

(20)%

Gold (000 troy oz)

24.7

33.9

24.1

22.3

27.9

(11)%

(27)%

Nickel (000 tonnes)

5.1

6.2

7.1

6.4

5.7

(11)%

(18)%

Copper (000 tonnes)

3.2

3.3

3.8

3.7

3.3

(3)%

(3)%

4E Built-up head grade (g/tonne milled)(4)

3.47

3.41

3.19

3.00

3.11

12%

2%

Platinum sales volumes - own mined and purchase of concentrate

518.8

606.5

588.0

808.4

412.8

26%

(14)%

 

(1)         Independently managed mines include the joint venture operations, Mototolo, Modikwa and Kroondal and the associates, Bokoni and BRPM.

(2)         Sale of Rustenburg to Sibanye completed on 1 November 2016. From this date production from Rustenburg is included within third party purchase of concentrate (POC).

(3)         Other includes Twickenham.

(4)         4E: the grade measured as the combined content of: platinum, palladium, rhodium and gold.

 

 

 

COPPER

 

Copper(1)

 

Q1

2017

Q1

2016

Q1 2017

vs.

Q1 2016

Q4

2016

Q1 2017

vs.

Q4 2016

Collahuasi (44% share)

t

57,700

51,100

13%

58,600

(2)%

Los Bronces

t

75,800

85,200

(11)%

74,300

2%

El Soldado

t

9,100

10,200

(11)%

13,700

(34)%

Total Copper

t

142,600

146,500

(3)%

146,600

(3)%

 

(1)       Copper production shown on a contained metal basis.

 

Copper - Copper production decreased by 3% to 142,600 tonnes.

 

At Collahuasi, attributable production increased by 13% to 57,700 tonnes, driven by higher grades and continued improvements in plant performance. Adverse weather conditions impacted mining operations, however plant throughput levels were maintained through the feed of stockpiled material.

 

Production from Los Bronces decreased by 11% to 75,800 tonnes, although 2% higher compared to the prior quarter, with expected lower grades and increased ore hardness affecting throughput. In addition, planned major maintenance took place at both processing plants in the quarter.

 

El Soldado production decreased by 11% to 9,100 tonnes driven by the temporary suspension of mining operations from 18 February following the regulator's decision to not approve the mine plan update, which resulted in ~3,000 tonnes of lost production in Q1 2017. Engagement continues with the authorities.

 

Full Year Guidance

Full year production guidance remains unchanged at 570,000 - 600,000 tonnes, of which El Soldado represents 50,000 - 60,000 tonnes.

 

 

 

Copper (tonnes) on a contained metal basis unless stated otherwise(1)

Q1 2017

Q4 2016

Q3 2016

Q2 2016

Q1 2016

Q1 2017

vs.

Q1 2016

Q1 2017

vs.

Q4 2016

Collahuasi 100% basis

(Anglo American share 44%)

 

 

 

 

 

 

 

Ore mined

13,803,300

20,335,200

17,131,800

15,277,400

14,858,200

(7)%

(32)%

Ore processed - Sulphide

12,336,400

12,302,700

12,522,100

12,479,200

12,102,800

2%

-

Ore grade processed - Sulphide (% TCu)(2)

1.24

1.29

1.23

1.21

1.15

8%

(4)%

Production - Copper cathode

100

700

800

1,400

1,900

(95)%

(86)%

Production - Copper in concentrate

131,000

132,400

128,900

126,300

114,200

15%

(1)%

Total copper production for Collahuasi

131,100

133,100

129,700

127,700

116,100

13%

(2)%

Anglo American's share of copper production for Collahuasi(3)

57,700

58,600

57,000

56,200

51,100

13%

(2)%

Anglo American Sur

84,900

88,000

82,800

88,000

95,400

(11)%

(4)%

Los Bronces mine(4)

75,800

74,300

72,100

75,600

85,200

(11)%

2%

Ore mined

13,448,400

13,196,500

13,947,400

13,477,900

10,487,900

28%

2%

Marginal ore mined

11,461,400

8,445,700

6,192,800

6,148,500

13,402,300

(14)%

36%

Ore processed - Sulphide

11,877,400

11,562,500

11,511,700

12,567,500

12,055,300

(1)%

3%

Ore grade processed - Sulphide (% TCu)

0.69

0.69

0.65

0.62

0.74

(7)%

(1)%

Production - Copper cathode

8,900

8,600

8,800

8,900

9,700

(8)%

3%

 

Production - Copper in concentrate

66,900

65,700

63,300

66,700

75,500

(11)%

2%

El Soldado mine(4)

9,100

13,700

10,700

12,400

10,200

(11)%

(34)%

Ore mined

905,500

2,069,800

1,678,300

2,143,000

1,448,000

(37)%

(56)%

Ore processed - Sulphide

1,797,600

1,833,900

1,553,200

1,741,200

1,836,100

(2)%

(2)%

Ore grade processed - Sulphide (% TCu)

0.65

0.90

0.86

0.89

0.75

(13)%

(28)%

Production - Copper in concentrate

9,100

13,700

10,700

12,400

10,200

(11)%

(34)%

Chagres Smelter(4)

 

 

 

 

 

 

 

Ore smelted

31,300

25,900

35,500

36,500

35,900

(13)%

21%

Production

30,300

25,400

34,700

35,500

35,200

(14)%

19%

Total Copper segment copper production

216,000

221,100

212,500

215,700

211,500

2%

(2)%

Total Attributable copper production(5)

142,600

146,600

139,800

144,200

146,500

(3)%

(3)%

Total Attributable payable copper production

137,500

141,300

135,000

139,200

141,600

(3)%

(3)%

Total Attributable sales volumes

115,300

161,400

135,400

143,500

137,500

(16)%

(29)%

Total Attributable payable sales volumes

111,200

155,700

130,700

138,500

133,000

(16)%

(29)%

Third party sales(6)

9,800

20,100

26,000

6,700

9,200

7%

(51)%

 

(1)          Excludes Anglo American Platinum's copper production.

(2)          TCu = total copper.

(3)          Anglo American's share of Collahuasi production is 44%.

(4)          Anglo American ownership interest of Anglo American Sur is 50.1%. Production is stated at 100% as Anglo American consolidates Anglo American Sur.

(5)          Difference between total copper production and attributable copper production arises from Anglo American's 44% interest in Collahuasi.

(6)          Relates to sales of copper not produced by Anglo American operations.

 

 

 

 

 

IRON ORE AND MANGANESE

 

Iron Ore and Manganese

Q1

2017

Q1

2016

Q1 2017

vs.

Q1 2016

Q4

2016

Q1 2017

vs.

Q4 2016

Iron ore - Kumba

000 t

         10,473

8,925

  17%

   11,928

(12)%

Iron ore - Minas-Rio(1)

000 t

4,342

3,349

30%

4,855

(11)%

Manganese ore(2)

000 t

823

776

6%

804

2%

Manganese alloys(3)

000 t

31

32

(2)%

37

(18)%

 

(1)  Wet basis.

(2)  Saleable production.

(3)  Production includes medium carbon ferro-manganese.

 

Kumba Iron Ore - Iron ore production increased by 17% to 10.5 million tonnes.

 

Sishen produced 7.7 million tonnes, a 31% increase driven by improved mining productivity resulting in higher plant throughput. As expected, production decreased by 10% compared to the previous quarter as Q4 2016 benefitted from greater access to low strip ratio ore. Waste removal of 33.9 million tonnes, in line with Q1 2016, was hampered by higher than expected rainfall during the quarter but the run rates improved in the latter part of Q1 2017 to levels required to meet full year guidance of 150-160 million tonnes.

 

Kolomela production increased by 3% to 2.8 million tonnes, due to higher throughput. Waste removal increased by 32% to 10.1 million tonnes in support of production growth. Going forward, waste removal run rates are expected to improve to meet full year guidance for 2017 of 50-55 million tonnes.

 

Export sales increased by 7% to 10.1 million tonnes. Total finished product stocks were 3.2 million tonnes, compared with 3.5 million tonnes at 31 December 2016, in line with optimum level of ~3 million tonnes.

 

Full Year Guidance

Full year production guidance remains unchanged at 40-42 million tonnes.

 

 

Iron Ore Brazil - Iron ore production from Minas-Rio increased by 30% to 4.3 million tonnes (wet basis) as the operation continued to ramp-up to its current operating capacity. Production decreased by 11% compared to Q4 2016 due to expected lower grades, and the impact of higher rainfall at the start of the rainy season. After the Step 3 licences have been secured, expected in late 2018, the operation is expected to be in a position to produce at its nameplate capacity of 26.5 million tonnes   (wet basis) per year. 

 

Full Year Guidance

Full year production guidance remains unchanged at 16-18 million tonnes (wet basis).

 

Manganese ore - Manganese ore production increased by 6% to 823,000 tonnes, mainly as a result of opportunistic sales of South African concentrate and the use of trucking to access export opportunities in response to favourable market conditions. Ore production from the Australian operations was broadly in line with Q1 2016.

 

Manganese alloy - Manganese alloy production was broadly in line with Q1 2016 at 31,000 tonnes. The South African Manganese operations continue to operate only one of four furnaces.

 

 

 

 

Iron Ore and Manganese (tonnes)

Q1 2017

Q4 2016

Q3 2016

Q2 2016

Q1 2016

Q1 2017

vs.

Q4 2016

Kumba Iron Ore

10,472,600

11,927,900

11,759,900

8,863,600

8,924,500

17%

(12)%

By product:

 

 

 

 

 

 

 

Lump

6,978,800

7,812,000

7,598,500

5,721,300

5,669,700

23%

(11)%

Fines

3,493,800

4,115,900

4,161,400

3,142,300

3,254,800

7%

(15)%

By mine:

 

 

 

 

 

 

 

Sishen

7,678,900

8,489,900

8,348,700

5,699,600

5,841,800

31%

(10)%

Kolomela

2,793,700

3,438,000

3,411,200

3,164,000

2,713,100

3%

(19)%

Thabazimbi

-

-

-

-

369,600

 

-

Kumba sales volumes

 

 

 

 

 

 

 

Export iron ore

10,053,000

10,611,400

10,343,200

8,729,700

9,376,100

7%

(5)%

Domestic iron ore

832,700

612,700

706,900

936,000

1,167,700

(29)%

36%

Minas-Rio production

 

 

 

 

 

 

 

Pellet feed (wet basis)

4,341,700

4,855,300

4,452,400

3,483,800

3,349,400

30%

(11)%

Minas-Rio sales volumes

 

 

 

 

 

 

 

Export - pellet feed

(wet basis)

4,256,500

4,761,800

4,510,400

3,223,900

3,714,400

15%

(11)%

Samancor

 

 

 

 

 

 

 

Manganese ore(1)

823,100

804,200

761,700

791,300

775,900

6%

2%

Manganese alloys(1)(2)

31,500

37,100

38,900

29,700

32,100

(2)%

(15)%

Samancor sales volumes

 

 

 

 

 

 

 

Manganese ore(3)

836,000

805,000

757,400

813,300

850,700

(2)%

4%

Manganese alloys

34,400

31,600

49,200

46,400

42,800

(20)%

9%

 

(1)       Saleable production.

(2)       Production includes medium carbon ferro-manganese.

(3)       Comparatives have been restated.

 

 

 

COAL

 

Coal

 

Q1

2017

Q1

2016

Q1 2017

vs.

Q1 2016

Q4

2016

Q1 2017

vs.

Q4 2016

 Australia - excluding 2016 divestments(1)

 

 

 

 

 

Metallurgical - Export

000 t

5,242

4,098

28%

5,360

(2)%

Thermal - Export

000 t

479

805

(40)%

595

(20)%

South Africa

 

 

 

 

 

 

Thermal export - Primary(2)

000 t

4,059

3,842

6%

4,229

(4)%

Thermal export and domestic - Secondary(3)

000 t

978

779

26%

927

6%

Thermal domestic - Eskom

000 t

6,374

6,392

-

7,515

(15)%

Thermal domestic - Isibonelo(4)

000 t

896

1,160

(23)%

1,038

(14)%

Colombia

 

 

 

 

 

 

Thermal - Export

000 t

2,782

2,610

7%

2,801

(1)%

(1)       Excludes production from Foxleigh, which was sold on 30 August 2016, and Callide, which was sold on 31 October 2016.

(2)       Thermal export - Primary is export quality product. Comparatives have been restated to align with current presentation.

(3)       Thermal export and domestic - Secondary is lower quality product that can be sold into either the export or domestic markets. Comparatives have been restated to align with current presentation. In 2016, ~60% of secondary production was sold into the export market.

(4)       Restated to exclude domestic secondary coal production from mines other than Isibonelo.

 

 

Australia - Export metallurgical coal production increased by 28% to 5.2 million tonnes due to a longwall move at Moranbah in Q1 2016 and production ramping up at Grosvenor.

 

Australian export thermal coal production decreased by 40% to 0.5 million tonnes as Drayton ceased mining activities in October 2016 following the New South Wales Planning Assessment Commission's recommendation not to approve the Drayton South Project.

 

Production was impacted by Cyclone Debbie with production losses in the last week of March.  Mining activities have now restarted at all operations.  The impact on the rail network has been more material, and is still being assessed.  It is expected that this will impact Q2 sales volumes.

 

South Africa - Primary and secondary coal production increased by 9% to 5.0 million tonnes due to productivity improvements at most mines.

 

The sale of the Eskom-tied operating mines (New Vaal, New Denmark and Kriel) to Seriti Resources was announced on 10 April, and is expected to complete by the end of 2017. These mines produced 5.7 million tonnes in Q1 2017.

 

Domestic - (Isibonelo) thermal coal production decreased by 23% to 0.9 million tonnes due to a dragline fire which occurred during Q4 2016.

 

Colombia - Production increased by 7% to 2.8 million tonnes, through productivity gains.

 

Full Year Guidance

Full year production guidance for export metallurgical coal from Australia remains unchanged at 19-21 million tonnes.

Full year production guidance for export thermal coal from South Africa and Colombia remains unchanged at 29-31 million tonnes.
 

Coal (tonnes)

Q1 2017

Q4 2016

Q3 2016

Q2 2016

Q1 2016

Q1 2017

vs.

Q1 2016

Q1 2017

vs.

Q4 2016

Australia (all export)(1)

5,721,400

5,955,100

5,923,500

5,935,700

4,902,200

17%

(4)%

Metallurgical - Coking

4,747,300

4,496,900

4,326,600

3,997,500

3,378,900

40%

6%

Metallurgical - PCI

495,100

862,900

741,300

923,300

718,800

(31)%

(43)%

Thermal

479,000

595,300

855,600

1,014,900

804,500

(40)%

(20)%

South Africa

12,307,300

13,708,600

14,690,700

13,188,800

12,171,800

1%

(10)%

Thermal export - Primary(2)

4,058,500

4,229,400

4,480,800

4,425,600

3,841,600

6%

(4)%

Thermal export and domestic - Secondary(3)

978,200

926,900

1,009,900

972,700

778,600

26%

6%

Thermal domestic - Eskom

6,374,300

7,514,700

8,083,900

6,708,700

6,392,000

-

(15)%

Thermal domestic - Isibonelo(4)

896,300

1,037,600

1,116,100

1,081,800

1,159,600

(23)%

(14)%

Colombia

 

 

 

 

 

 

 

Thermal - Export

2,781,700

2,800,600

2,927,800

2,329,500

2,610,000

7%

(1)%

Total coal production

20,810,400

22,464,300

23,542,000

21,454,000

19,684,000

6%

(7)%

Sales volumes

 

 

 

 

 

 

 

Australia

 

 

 

 

 

 

 

Metallurgical - Export(5)

4,947,400

4,926,900

5,223,100

4,836,700

4,228,900

17%

-

Thermal - Export

473,200

699,000

862,000

1,118,800

697,900

(32)%

(32)%

South Africa

 

 

 

 

 

 

 

Thermal - Export

4,693,300

5,825,200

4,159,300

4,744,000

4,343,200

8%

(19)%

Thermal - Other domestic

394,300

485,100

389,700

341,600

368,600

7%

(19)%

Thermal domestic - Eskom

6,359,200

7,288,500

7,871,900

6,577,500

6,246,400

2%

(13)%

Thermal domestic - Isibonelo

964,600

1,168,900

1,260,800

1,268,100

1,213,600

(21)%

(17)%

Third party sales

1,567,800

694,600

2,181,800

1,608,600

1,566,700

-

126%

Colombia

 

 

 

 

 

 

 

    Thermal - Export

2,646,300

2,722,300

2,905,100

2,843,800

2,339,000

13%

(3)%

(1)       Comparatives have been restated to exclude production from Foxleigh, which was sold on 30 August 2016, and Callide, which was sold on 31 October 2016.

(2)       Thermal export - Primary is export quality product. Comparatives have been restated to align with current presentation.

(3)       Thermal export and domestic - Secondary is lower quality product that can be sold into either the export or domestic markets. Comparatives have been restated to align with current presentation. In 2016, ~60% of secondary production was sold into the export market.

(4)       Restated to exclude domestic secondary coal production from mines other than Isibonelo.

(5)       Includes both hard coking coal and PCI sales volumes.

Coal by mine (tonnes)

Q1 2017

Q4 2016

Q3 2016

Q2 2016

Q1 2016

Q1 2017

vs.

Q1 2016

Q1 2017

vs.

Q4 2016

Australia

 

 

 

 

 

 

Capcoal

(incl. Grasstree)

1,785,400

1,230,200

1,637,300

2,205,400

1,760,000

1%

45%

Dawson

1,092,100

1,273,000

1,185,900

1,143,800

1,006,000

9%

(14)%

Drayton

-

82,300

317,100

418,200

349,900

(100)%

(100)%

Grosvenor

709,800

539,100

685,700

331,200

203,000

250%

32%

Jellinbah

718,000

882,100

820,200

821,600

758,400

(5)%

(19)%

Moranbah North

1,416,100

1,948,400

1,277,300

1,015,500

824,900

72%

(27)%

 

5,721,400

5,955,100

5,923,500

5,935,700

4,902,200

17%

(4)%

South Africa

 

 

 

 

 

 

 

Goedehoop

1,222,100

1,134,200

1,286,500

1,266,600

1,001,300

22%

8%

Greenside

1,004,800

1,036,900

1,111,400

990,700

806,300

25%

(3)%

Zibulo

1,439,400

1,407,200

1,571,800

1,638,600

1,390,000

4%

2%

Khwezela(1)

1,596,100

2,230,000

2,137,100

1,849,000

1,969,600

(19)%

(28)%

Mafube

441,400

435,400

506,000

438,500

379,100

16%

1%

New Vaal

3,414,300

3,994,800

4,350,500

4,027,700

3,521,800

(3)%

(15)%

New Denmark

954,400

773,200

777,300

392,600

604,300

58%

23%

Kriel

1,338,500

1,659,400

1,834,000

1,503,300

1,339,800

-

(19)%

Isibonelo

896,300

1,037,500

1,116,100

1,081,800

1,159,600

(23)%

(14)%

 

12,307,300

13,708,600

14,690,700

13,188,800

12,171,800

1%

(10)%

Colombia

 

 

 

 

 

 

 

Carbones del Cerrejón

2,781,700

2,800,600

2,927,800

2,329,500

2,610,000

7%

(1)%

Total Coal production

20,810,400

22,464,300

23,542,000

21,454,000

19,684,000

6%

(7)%

 

 (1)       The merger of Kleinkopje and Landau.

 

NICKEL

 

Nickel

 

Q1

2017

Q1

2016

Q1 2017

vs.

Q1 2016

Q4

2016

Q1 2017

vs.

Q4 2016

Nickel

t

9,900

11,200

(12)%

10,900

(9)%

 

Nickel - Nickel production decreased by 12% to 9,900 tonnes due to unplanned maintenance of Barro Alto's electric furnaces.

Full Year Guidance

As a consequence, full year production guidance has been revised to 43,000 - 45,000 tonnes (previously ~45,000 tonnes).

 

 

Nickel (tonnes)

unless stated otherwise(1)

Q1 2017

Q4 2016

Q3 2016

Q2 2016

Q1 2016

Q1 2017

vs.

Q1 2016

Q1 2017

vs.

Q4 2016

Barro Alto

 

 

 

 

 

 

 

Ore mined

1,023,500

364,300

974,100

835,300

457,000

124%

181%

Ore processed

523,900

579,800

610,000

569,200

598,100

(12)%

(10)%

Ore grade processed - % Ni

1.70

1.77

1.76

1.76

1.77

(4)%

(4)%

Production

7,800

8,800

9,000

8,800

8,900

(12)%

(11)%

Codemin

 

 

 

 

 

 

 

Ore mined

-

-

-

6,800

-

-

-

Ore processed

143,600

142,900

144,000

151,300

151,400

(5)%

0%

Ore grade processed - % Ni

1.65

1.73

1.72

1.72

1.68

(2)%

(5)%

Production

2,100

2,100

2,300

2,300

2,300

(9)%

0%

Total Nickel segment nickel production

9,900

10,900

11,300

11,100

11,200

(12)%

(9)%

Sales volumes

10,400

11,400

11,600

11,100

10,800

(4)%

(9)%

 

(1)       Excludes Anglo American Platinum's nickel production.

 

 

EXPLORATION AND EVALUATION

 

Exploration and evaluation expenditure for the quarter increased by 9% to $50 million. Exploration expenditure for the quarter was $20 million, a 31% decrease, whilst evaluation expenditure was $30 million, a 76% increase.

 

NOTE

 

This Production Report for the first quarter ended 31 March 2017 is unaudited.

Note:

 

Production figures are sometimes more precise than the rounded numbers shown in the commentary of this report. The percentage change will reflect the percentage change using the production figures shown in the Production Summary of this report.

 

Forward-looking statements:

 

This contains certain forward looking statements which involve risk and uncertainty because they relate to events and depend on circumstances that occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward looking statements.

 

For further information, please contact:

 

Media

 

Investors

UK

James Wyatt-Tilby

james.wyatt-tilby@angloamerican.com

Tel: +44 (0)20 7968 8759

 

Marcelo Esquivel

marcelo.esquivel@angloamerican.com

Tel: +44 (0)20 7968 8891

 

South Africa

Pranill Ramchander

pranill.ramchander@angloamerican.com

Tel: +27 (0)11 638 2592

 

Ann Farndell

ann.farndell@angloamerican.com

Tel: +27 (0)11 638 2786

 

UK

Paul Galloway

paul.galloway@angloamerican.com

Tel: +44 (0)20 7968 8718

 

Trevor Dyer

trevor.dyer@angloamerican.com

Tel: +44 (0)20 7968 8992

 

Sheena Jethwa

sheena.jethwa@angloamerican.com

Tel: +44 (0)20 7968 8680

 

Notes to editors:

 

Anglo American is a globally diversified mining business. Our portfolio of world-class competitive mining operations and undeveloped resources provides the raw materials to meet the growing consumer-driven demands of the world's developed and maturing economies. Our people are at the heart of our business. It is our people who use the latest technologies to find new resources, plan and build our mines and who mine, process and move and market our products to our customers around the world.

 As a responsible miner - of diamonds (through De Beers), platinum and other precious metals, copper, nickel, iron ore and coal - we are the custodians of what are precious natural resources. We work together with our key partners and stakeholders to unlock the long-term value that those resources represent for our shareholders and for the communities and countries in which we operate - creating sustainable value and making a real difference.

www.angloamerican.com


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