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.
Freeport-McMoRan (NYSE:FCX), which operates the world’s largest gold and copper mine in Papua, Indonesia, said that its 4Q net income tumbled to $640 million or 67 cents per share compared with net income of $1.5 billion or $1.63 per share a year ago.
Labour problems at its Indonesian mine caused copper and gold production to fall. The company did finish the year up. Net income was $4.560 billion in 2011 compared to $4.273 billion in 2010.
The company’s stock was largely unchanged at $44.49 a share.
Copper production for both the year and the 4Q were down. The company recovered 823 million pounds of copper in 4Q compared with 1.007 billion pounds a year ago. Overall copper production was 3.691 billion in 2011 compared to 3.908 billion in 2010.
Gold was also down from 181,000 ounces in 2011 4Q compared with 629,000 a year ago. Overall gold production in 2011 was 1.383 million ounces compared with 1.868 million ounces.
“The estimated impact of the labor and pipeline disruptions (net to PT Freeport Indonesia), including the eight-day work stoppage in July 2011, totaled 165 million pounds of copper and 170 thousand ounces of gold in fourth-quarter 2011, and 235 million pounds of copper and 275 thousand ounces of gold for the year 2011,” said the company in a statement.
Looking ahead Freeport says that sales from Indonesia will be about 930 million pounds of copper and 1.1 million ounces of gold for the year 2012, compared to 2011 sales of 846 million pounds of copper and 1.3 million ounces of gold.
“Gold sales in 2012 are projected to be lower than in 2011 because of mining in a lower grade section of the Grasberg mine in 2012. At the Grasberg mine, the sequencing of mining areas with varying ore grades also causes fluctuations in the timing of ore production resulting in varying quarterly and annual sales of copper and gold. The achievement of projected 2012 sales volumes depends on a number of factors, including the timing of restoring full operations at Grasberg following the extended disruption.”
