Lundin Mining Announces 2018 Production Results and Fourth Quarter
and Full Year 2018 Results Date
(TSX: LUN; Nasdaq Stockholm: LUMI) Lundin Mining
Corporation (“Lundin Mining” or the “Company”) announces
production results for the three and twelve months ended December
31, 2018 and provides an update on operations and capital projects.
The financial results for the quarter and year ended December 31,
2018 will be published on February 14, 2019.
Highlights:
- Annual production guidance was achieved or exceeded for all
metals at all operations.
- Safety performance in 2018 was in line with the Company’s
five-year health and safety improvement strategy. The 2018
Total Recordable Injury Frequency (TRIF) rate was 0.67.
- Candelaria achieved its full year copper production guidance.
The low-risk capital projects focused on delivering the improved
life-of-mine production profile continue on schedule and on
budget.
- Eagle continued its robust operational performance achieving
and exceeding full year copper and nickel production guidance,
respectively. The Eagle East project continues to advance well with
first ore expected in the fourth quarter of 2019.
- Neves-Corvo achieved full year zinc production guidance and
exceeded copper production guidance. The zinc plant set an
annual throughput record of 1,125 kt and the copper plant set an
annual throughput record of 2,692 kt.
- Zinkgruvan exceeded annual zinc production guidance. Fourth
quarter zinc production was the best quarter of the year on
improved zinc head grades and mill throughput.
- Year-end cash balance was approximately $800 million reflecting
the fourth quarter investment spend and early redemption of $429
million principal amount of 7.875% Senior Secured Notes.
Marie Inkster, President and CEO
commented: “We finished 2018 with strong fourth quarter
operating performance at each of our mines and excellent progress
advancing our growth projects. We are well positioned to deliver
significant copper and zinc production growth in 2019 and the next
several years from our existing portfolio of high-quality
mines.
We remain focused on value creation through
disciplined investment in our existing assets and potential
external acquisition initiatives. In the fourth quarter, we
announced a normal course issuer bid and significantly reduced our
borrowing costs with the early redemption of our Senior Secured
Notes. We maintain financial liquidity and flexibility to act
quickly on opportunities with a substantive cash position and
having increased and extended our low-cost revolving credit
facility.”
Summary of 2018 Production
(contained tonnes) |
Q4 2018 Production Results |
Full Year 2018 Production Results |
2018 Production Guidance1 |
Copper |
Candelaria
(100% basis) |
33,011 |
134,578 |
|
133,750 – 136,250 |
|
Eagle |
3,908 |
17,974 |
|
16,000 – 18,000 |
|
Neves-Corvo |
11,287 |
45,692 |
|
43,000 – 45,000 |
|
Zinkgruvan |
- |
1,386 |
|
1,000 – 2,000 |
|
Total
Copper |
48,206 |
199,630 |
|
193,750 – 201,250 |
|
|
|
|
|
|
Zinc |
Neves-Corvo |
18,465 |
75,435 |
|
73,000 – 76,000 |
|
Zinkgruvan |
23,559 |
76,606 |
|
74,000 – 76,000 |
|
Total
Zinc |
42,024 |
152,041 |
|
147,000 – 151,000 |
|
|
|
|
|
|
Nickel |
Eagle |
3,501 |
17,573 |
|
15,000 – 17,000 |
|
Total Nickel |
3,501 |
17,573 |
|
15,000 – 17,000 |
1. Guidance as disclosed in the Company’s Management Discussion
and Analysis for the three and nine months ended September 30,
2018. Candelaria guidance and results were previously disclosed at
80% attributable.
Operations and Capital Projects
Commentary
- Safety Performance: Overall safety performance was
better than target with a year-end Company TRIF rate of 0.67
recorded against a target of 0.70 per 200,000 person hours
worked. This was the sixth consecutive year that overall
safety performance was better than a continually improved target.
This performance was achieved even with an increase in exposure
hours by 9.5% over 2017 with major project activities underway
across the company.
- Candelaria: Copper production guidance was
achieved for the year. Approximately 60% of the new open pit mine
fleet has been received and placed in service. The remaining
equipment is expected to be delivered mainly in 2019 with some
pieces arriving in early 2020.
Ramp-up of the
Candelaria underground mines continues with the North Sector
achieving a production rate of approximately 10,200 tonnes per day
for the year, representing an 11% increase in ore production over
2017. Development of the South Sector continues to progress well
for first ore in late 2019. The Candelaria Mill Optimization
Project to improve metal recoveries, increase throughput capacity
and reduce maintenance costs is advancing well and was
approximately 40% complete at year end.
- Eagle: Copper and nickel production achieved and
exceeded full year guidance, respectively, on continued excellent
operational performance. Fourth quarter nickel and copper
production decreased compared to prior quarters as per planned mine
sequencing and resulting in lower nickel and copper head grades
prior to commencing production from Eagle East.
The Eagle East
project continues to advance well with first ore expected in the
fourth quarter of 2019. In 2018, the access ramp development to
Eagle East from the Eagle Mine advanced approximately 3,400 meters
with completion of the dual decline sections and the spiral decline
to the orebody now advancing.
- Neves-Corvo: Full year zinc and copper production
achieved and exceeded guidance, respectively. Fourth quarter
production benefited from improving mine productivity and higher
mill throughput demonstrated throughout the year.
The Zinc Expansion
Project was approximately 43% construction complete at year end.
Underground development remains on track for completion in early
2020 with ore from this newly developed area of the mine to
contribute to mill feed in the first quarter of 2020.
Surface facilities
construction remains on track to be completed and commence
commissioning in early 2020. Major surface works milestones
achieved in 2018 include completion of the SAG mill foundation as
well as structural steel erection for the new flotation
building.
- Zinkgruvan: Full year zinc production exceeded guidance.
Fourth quarter zinc production was the best quarter of the year
owing to improved zinc ore head grades following focused efforts in
planning and execution to improve dilution and ore loss experienced
earlier in the year.
Fourth Quarter and Full Year 2018 Results
Date
The report for the fourth quarter and full year
ended December 31, 2018 will be published on Thursday February 14,
2019.
The Company will hold a telephone conference call and webcast at
08:00am ET, 14:00 CET on Friday, February 15, 2019. Conference call
details are provided below:
Please call in 10 minutes before the conference starts and
stay on the line (an operator will be available to assist
you).
Call-in number for the conference call (North America): +1 617
826 1698
Call-in number for the conference call (North America Toll
Free): +1 877 648 7976
Call-in number for the conference call (Sweden): +46 (0) 8 5661
9361
To view the live webcast presentation, please log on using this
direct link:
https://www.investornetwork.com/event/presentation/42071
The presentation slideshow will also be available in PDF format
for download from the Lundin Mining website
http://www.lundinmining.com before the conference call.
A replay of the telephone conference will be available after the
completion of the conference call until February 22, 2019.
Replay numbers:
North America: 1 855 859 2056 or +1 404 537 3406
The passcode for the replay is: 3568927
A replay of the webcast will be available by clicking on the
direct link above.
About Lundin Mining
Lundin Mining is a diversified Canadian base
metals mining company with operations in Chile, the United States
of America, Portugal and Sweden, primarily producing copper, nickel
and zinc. In addition, Lundin Mining holds an indirect 24% equity
stake in the Freeport Cobalt Oy business, which includes a cobalt
refinery located in Kokkola, Finland.
The information in this release is subject to the disclosure
requirements of Lundin Mining under the EU Market Abuse Regulation.
The information was submitted for publication, through the agency
of the contact persons set out below on January 15, 2019 at 5:30
p.m. Eastern Time.
For further information, please contact:
Mark Turner, Director, Business Valuations and
Investor Relations: +1 416 342 5565
Brandon Throop, Manager, Investor
Relations: +1 416 342 5583
Robert Eriksson, Investor Relations Sweden:
+46 8 545 015 50
Cautionary Statement in Forward-Looking
Information
Certain of the statements made and information
contained herein or incorporated by reference is “forward-looking
information” within the meaning of applicable Canadian securities
laws. All statements other than statements of historical facts in
this news release constitute forward-looking information based on
current expectations, estimates, forecasts and projections as well
as beliefs and assumptions made by the Company’s management. Such
forward-looking statements include but are not limited to those
regarding the Company’s outlook and guidance on estimated metal
production and production profile, costs, and exploration and
capital expenditures; the Zinc Expansion Project at Neves-Corvo and
the Eagle East project ; Mineral Reserves, Mineral Resources,
life-of-mine (or mine life); all of which are estimates (and the
parameters, expectations and assumptions underlying, and
realization of, such estimates including, but not limited to metal
price assumptions, and permitting and development expectations.
Words such “aim”, “anticipate”, “assumption”, “believe”, “budget”,
“commitment”, “estimate, “expansionary”, “expect”, “exploration”,
“flexibility”, “focus”, “forecast”, “foreseeable”, “forward”,
“future”, “growth”, “guidance”, “initiative”, “on-track”,
“outlook”, “plan”, “positioning”, “potential”, “priority”,
“profile”, “project”, “ramp-up”, “risk”, “schedule”, “study”,
“target” or “view” , or variations of or similar such terms, or
statements that certain actions, events or results could, may,
might or will be taken or occur or be achieved,, or variations of
these terms or similar terminology or statements that certain
actions, events or results could , may, might or will be taken or
occur or be achieved are intended to identify such forward-looking
information. These estimates, expectations and other
forward-looking statements are based on a number of assumptions and
are subject to a variety of risks and uncertainties which could
cause actual events or results to differ materially from those
reflected in the forward-looking statements. Such risks and
uncertainties include, without limitation, risks and uncertainties
inherent in and/or relating to: estimates of future production and
operations, cash and all-in sustaining costs; metal and commodity
price fluctuations; foreign currency fluctuations; mining
operations including but not limited to environmental hazards,
industrial accidents, ground control problems and flooding; geology
including, but not limited to, unusual or unexpected geological
formations, estimation and modelling of grade, tonnes, metallurgy
continuity of mineral deposits, dilution, and Mineral Resources and
Mineral Reserves, and actual ore mined and/or metal recoveries
varying from such estimates; mine plans, and life of mine
estimates; the possibility that future exploration, development or
mining results will not be consistent with expectations; the
potential for and effects of labour disputes or shortages, or other
unanticipated difficulties with or interruptions in production;
potential for unexpected costs and expenses including, without
limitation, for mine closure and reclamation at current and
historical operations; uncertain political and economic
environments; changes in laws or policies, foreign taxation, delays
or the inability to obtain necessary governmental approvals and/or
permits, including but not limited to the Alcaparrosa underground
mine operating license, the Punta Padrones process operating
license and the Ojos del Salado mill tailings line permit at
Candelaria which are required by the end of the year; regulatory
investigations, enforcement, sanctions and/or related or other
litigation; and other risks and uncertainties, including but not
limited to those described in the “Managing Risks” section of the
Company’s Management’s Discussion and Analysis for the financial
period ending December 31, 2017 and completed financial quarters in
2018, and the “Risks and Uncertainties” section of our most
recently filed Annual Information Form. In addition,
forward-looking information is based on various assumptions
including, without limitation, the expectations and beliefs of
management; assumed prices of copper, nickel, zinc and other
metals; 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, there can be
no assurance that forward-looking information will prove to be
accurate, and readers should not place undue reliance on
forward-looking statements. The Company disclaims any intention or
obligation to update or revise forward‐looking statements or to
explain any material difference between such and subsequent actual
events, except as required by applicable
law.
- lumi_190115_2018_production_results
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