Freeport Indonesia to process 400,000t of copper concentrate at new smelter
Earlier this month, Freeport obtained an export permit for the rest of the year from the government.
Canada’s First Quantum Minerals (TSE:FM) said Tuesday that the estimated cost of its massive Cobre Panama project in Central America will rise to $6.4 billion, but at at the same time sharply raised forecast output for the copper-gold-silver mine.
Vancouver-based First Quantum said Cobre production should come in at roughly 320,000 tonnes copper a year, up 20% from plan laid out by Inmet, a company First Quantum took over in a hostile $5 billion deal in March last year.
The new project cost estimates for the mine, power and port infrastructure include $421 million of contingency and $913 million of capital expenditures incurred prior to the acquisition of Inmet.
The update, the first the company has provided since inheriting the project also pushed out the completion date to the second half of 2017 instead of early 2016.
The $12 billion company listed in London and Toronto said unlike the outsourced model used by Inmet, it is bringing construction in house entirely and has already canceled or modified current contractor agreements.
The company has reduced capital to be spent per tonne copper produced by some 30% to $17,000 a tonne.
First Quantum also forecast average annual life-of-mine by-product production of 100,000 ounces gold; 1,800,000 ounces silver and 3,500 tonnes molybdenum.
First Quantum’s shares reacted positively to the Cobre news, adding 2.6% in Toronto with more than 3.7 million shares exchanging ownership. Compared to its peers First Quantum’s shares have held up well and is at breakeven for the past year.
Last week First Quantum posted solid production numbers across its operations including record numbers from its Kansanshi copper-gold mine in Zambia.
For 2013, production totaled 412,00 tonnes of copper, up more than 100,000 tonnes from the year before. First Quantum is on an aggressive expansion drive and production is set to top 1 million tonnes by 2018.
Cobre Panama is one of the largest of a slew of massive greenfields copper projects to enter production over the next few years.
Codelco’s 160,000 tonnes-plus Ministro Hales mine in Chile, Glencore’s Las Bambas project in Peru it is close to selling, expansion at other Codelco properties and at BHP Billiton’s Escondida, will increase supply of the red metals by some 4% annually through 2016.
After a surge in December, the copper price is having a tough 2014 over worries about economic growth from number one consumer China. On Tuesday spot copper was changing hands at $3.29 a pound, down 4.4% so far this year and 10% below the price this time last year.
Image of infrastructure construction around Cobre Panama project April 2013 by Enstoa
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AussieMiner
some ignorant comments here