Lundin Mining Reports Second Quarter Results
(firmenpresse) - TORONTO, ONTARIO -- (Marketwire) -- 07/25/12 -- Lundin Mining Corporation (TSX: LUN)(OMX: LUMI) ("Lundin Mining" or the "Company") today reported net earnings of $44.1 million ($0.08 per share) for the three months ended June 30, 2012 compared to $60.1 million ($0.10 per share) for the three months ended June 30, 2011.
Sales volumes in the current quarter increased to 16,749 tonnes of copper and 28,949 tonnes of zinc from 15,023 tonnes of copper and 18,228 tonnes of zinc in the second quarter of last year. Unit cash costs(1) for copper fell to $1.61/lb, compared to $2.13/lb in the second quarter of 2011, a decrease of 24%. Unit cash costs(1) for zinc were $0.12/lb for the quarter, compared to $0.26/lb in the second quarter of last year, a decrease of 54%.
Paul Conibear, President and CEO commented, "Our second quarter results continue to demonstrate our focus on and commitment to continuously improving our operational performance. Our operational successes year-to-date have resulted in our production and cash costs being better than expected, which has allowed us to revise our copper production guidance upwards for the year.
In addition, we are very pleased that the ramp-up at Tenke's Phase II Expansion Project has already resulted in the first copper being produced from half of the expanded tankhouse. This represents a significant milestone for this world-class asset.
Our Company remains very well positioned to continue to deliver solid operational performance and provide long-term, sustainable growth going forward supported by a healthy balance sheet."
Operational Highlights
Wholly-owned operations: After a strong first quarter, the Company continued to perform well in the second quarter with excellent operational results generating higher than expected copper and zinc production. Sales volumes were higher and operating costs lower than expectations.
Tenke: The mine and mill continue to perform well. Construction activities on the $850 million Phase II expansion are well advanced and start-up of several important sub-projects was achieved. The overall expansion is expected to be on budget and substantially completed by the end of 2012.
Financial Highlights
Tenke Fungurume
Financial Position and Financing
Projects
The Touro Project
Early in the second quarter of 2012, the Company entered into a purchase option agreement to acquire a controlling interest in the Touro Copper Project located in Galicia, northern Spain. The Option Agreement gives Lundin Mining an exclusive option until October 1, 2012, to purchase an 80% interest in the Project, pending satisfactory completion of due diligence, including confirmatory and step-out drilling and other technical work currently being conducted by the Company.
The Option Agreement provides that Lundin Mining may earn an 80% interest in the project by paying EUR60 million (the "Purchase Price") in stages, with EUR10 million payable on the exercise of the Option, EUR30 million when the Company makes a construction decision, and EUR20 million on the start of commercial production. Upon a decision to construct, Lundin Mining will fund 100% of the project costs, with those costs repayable preferentially with interest from surplus operating cash flows before other distributions. Further details are available in the press release dated April 11, 2012.
During the quarter, Spanish exploration personnel have been involved in an extensive resource evaluation program at the Touro Copper Project. Twin hole drilling confirmed historical results and the drills were moved on to step out drilling on the seven deposits to identify additional resources. 7,706 metres of drilling were completed using three rigs on Touro during the quarter, for a total of 15,281 metres drilled during the first half of the year. Total project spend was $2.9 million for the quarter ended June 30, 2012 and $4.1 million year-to-date.
A preliminary economic assessment was initiated with independent consultants which includes metallurgical test work, preliminary technical studies and capital cost benchmarking to support a decision regarding the option. A decision on the option is anticipated in September.
Neves-Corvo Materials Handling
Studies into the future access and materials handling options for the Semblana and Lombador Phase 2 (lower Lombador) mineralization continue. Preliminary comparisons of technical aspects, costs and schedule between a new shaft and a tunnel bored inclined ramp favour the selection of the ramp option for route flexibility, cost and schedule reasons. At a +/- 25% accuracy level, direct costs of the inclined ramp option for pre-production mine access development, underground services and mining equipment are estimated at approximately EUR330 million, more than 15% less than the shaft option. These costs do not include associated capital for surface facility expansion. Studies to date have also indicated that the inclined ramp option could allow commencement of production mining more than a year earlier than the five years estimated to design, sink and ready a shaft.
Designs and cost estimates are being refined over the next several months; however, equal priority is now being given to the study of shorter schedule, lower capital cost means of accessing Semblana and Lombador Phase 2 mineralization by extending the current underground infrastructure including debottlenecking the existing Neves-Corvo shaft. Supporting the consideration of lower cost options, additional mine planning is being done to advance copper production from Lombador mineralization facilitated by recent favourable drilling exploration results.
Exploration
Portugal
Neves-Corvo Mine Exploration (Copper, Zinc)
The 2012 resource exploration program includes a budgeted 90,000 metres of drilling and additional high-resolution 3D seismic surveying. A total of 29,145 metres was drilled with six rigs during the second quarter for a total of 53,306 metres drilled in the first half of the year.
Exploration at both Neves-Corvo and across the entirety of the Company's exploration projects has been impacted by an industry-wide shortage of assay laboratory capacity. Delays have been experienced in receiving results for important drilling in all programs. Consequently release of assay results and subsequent analysis are now expected in conjunction with our annual resource and reserve update intended for issue by early September. An update of the Semblana resource statement is expected in this release as well. The Company is considering ways to reduce the waiting time for receiving assay results, including the potential expansion of the Company's own accredited laboratory facilities at Neves-Corvo to reduce dependency on external laboratories and allow for more timely interpretation and follow up.
Delineation drilling at Semblana continued over the quarter, focusing on a zone of high-grade copper sulphides, located approximately 300 metres to the south of the initial Semblana resource. Preliminary results to date suggest that given the 800 - 900 metre depth of Semblana mineralization, continued surface drilling will only allow for a modest increase in the present copper-silver resource; underground exploration is required to more efficiently explore the Semblana deposit resource expansion potential. Consequently, an internal exploration ramp has commenced to facilitate underground-based exploration. The ramp is advancing from existing underground mine workings in the Zambujal deposit down towards Semblana. This new ramp is sized such that subject to future underground exploration results, development economics and permitting, the exploration ramp could also be used for production in conjunction with existing Neves-Corvo hoisting infrastructure. The cost of the exploration ramp development and services up to the end of 2015 is estimated at approximately $25 million, of which $5 million is budgeted for this year.
Drilling of an additional copper discovery named Monte Branco (water dam area), located approximately 1.2 kilometres to the south of Semblana and just west of the tailings management facility, has been successful in discovering a new massive sulphide deposit. The Monte Branco area, in conjunction with step-outs extending under the tailings facility, will receive a high priority for the balance of this year. The potential for developing new copper resources in this area is considered very good. Depth of mineralization encountered at Monte Branco is approximately 540-700 metres from surface.
Ireland
Clare Project (Zinc, Lead, Silver, Copper)
A total of 9,275 metres was drilled with two rigs during the quarter for a total of 15,684 metres drilled in the first half of the year. Drilling focussed on wide-spaced testing of target areas located near to the high-grade zinc-lead-silver and copper-silver mineralization (the "Copper Zone") discovered late last year, in addition to fence drilling across the Kilbricken Corridor east and west of the discovery zone. Mineralization remains open to the west, southwest and south of the Copper Zone.
Lakelands Project (Zinc, Lead)
A total of 6,339 metres was drilled with one rig during the second quarter for a total of 10,270 metres drilled in the first half of the year.
Fifteen holes were completed in the Reynold's Hill Prospect in County Leitrim. These widely-spaced, step-out holes continue to follow-up the significant zinc-lead intercept encountered last year in Navan equivalent beds. A significant number of core assay results have been delayed this year, and consequently drilling has been curtailed on the property until all assay results have been delivered and results interpreted. All holes intercepted widespread, disseminated zinc and locally also lead and copper sulphides further indicating that the mineralized system is extensive. Drilling is expected to resume in August with the objective of locating more concentrated zones of zinc-lead sulphides.
Outlook
2012 Production and Cost Guidance
2012 Capital Expenditure Guidance
Capital expenditures for 2012 are expected to be $410 million, consistent with previous guidance, as described below:
About Lundin Mining
Lundin Mining Corporation is a diversified base metals mining company with operations in Portugal, Sweden, Spain and Ireland, producing copper, zinc, lead and nickel. In addition, Lundin Mining holds a development project pipeline which includes expansion projects at its Neves-Corvo mine, along with a 24% equity stake in the world-class Tenke Fungurume copper/cobalt mine in the Democratic Republic of Congo, which is undergoing expansion to 195,000 tonnes per annum copper cathode production.
On Behalf of the Board,
Paul Conibear, President and CEO
Forward-Looking Statements
Certain of the statements made and information contained herein is "forward-looking information" within the meaning of the Ontario Securities Act. Forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements, including, without limitation, risks and uncertainties relating to foreign currency fluctuations; risks inherent in mining including environmental hazards, industrial accidents, unusual or unexpected geological formations, ground control problems and flooding; risks associated with the estimation of mineral resources and reserves and the geology, grade and continuity of mineral deposits; the possibility that future exploration, development or mining results will not be consistent with the Company's expectations; the potential for and effects of labour disputes or other unanticipated difficulties with or shortages of labour or interruptions in production; actual ore mined varying from estimates of grade, tonnage, dilution and metallurgical and other characteristics; the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses; commodity price fluctuations; uncertain political and economic environments; changes in laws or policies, foreign taxation, delays or the inability to obtain necessary governmental permits; and other risks and uncertainties, including those described under Risk Factors Relating to the Company's Business in the Company's Annual Information Form and in each management's discussion and analysis. Forward-looking information is, in addition, based on various assumptions including, without limitation, the expectations and beliefs of management, the assumed long-term price of copper, zinc, lead and nickel; that the Company can access financing, appropriate equipment and sufficient labour and that the political environment where the Company operates will continue to support the development and operation of mining projects. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking statements. Accordingly, readers are advised not to place undue reliance on forward-looking statements.
Contacts:
Lundin Mining Corporation
Sophia Shane
Investor Relations North America
+1-604-689-7842
Lundin Mining Corporation
John Miniotis
Senior Business Analyst
+1-416-342-5565
Lundin Mining Corporation
Robert Eriksson
Investor Relations Sweden
+46 8 545 015 50
Themen in dieser Pressemitteilung:
Unternehmensinformation / Kurzprofil:
Datum: 25.07.2012 - 22:30 Uhr
Sprache: Deutsch
News-ID 168829
Anzahl Zeichen: 0
contact information:
Town:
TORONTO, ONTARIO
Kategorie:
Mining & Metals
Diese Pressemitteilung wurde bisher 293 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"Lundin Mining Reports Second Quarter Results"
steht unter der journalistisch-redaktionellen Verantwortung von
Lundin Mining Corporation (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
