Anglo American lifts copper output amid portfolio shake-up

Anglo American has reported steady copper production and stronger operational performance across its key mining assets as the company presses ahead with a sweeping portfolio simplification, including the disposal of its diamond and platinum interests.

The diversified miner on Tuesday said improved copper grades and higher output from its Quellaveco and Los Bronces operations helped offset a temporary lower production phase at the Collahuasi mine in Chile, which is expected to recover by the end of next year.

Duncan Wanbald, CEO of Anglo American, said that in copper, strong operational momentum and higher grades at both Quellaveco and Los Bronces underpinned performance, offsetting the current lower production phase at Collahuasi.

Copper production for the quarter to the end of September was however flat at 183 500 tons, amid “strong plant performance coupled with higher grades at both Quellaveco and Los Bronces.

Despite the year on year flattening in copper production, Anglo American which is focusing more on copper after tying up with Teck Resources, lifted copper output by 6% on a quarter on quarter basis.

"We made further progress with our portfolio simplification, successfully divesting our residual 19.9% interest in Valterra Platinum, raising cash proceeds of c.$2.5 billion,” said Wanbald.

Anglo American is now working to secure regulatory approvals for its nickel transaction. The company has also made “good progress with the dual track separation” process for De Beers with “a structured sale process” currently being handled.

"Looking ahead, and building on the substantial value we have already unlocked through our own portfolio transformation, our agreement to merge with Teck represents our next major strategic step to accelerate value accretive growth, with the combined company forming a global critical minerals champion offering more than 70% copper exposure,” said Wanbald.

Moreover, Anglo American’s agreement with Codelco to implement a joint mine plan for the adjacent Los Bronces and Andina operations in Chile details compelling industrial synergies as a means to drive the company’s copper growth ambitions.

Anglo American’s rough diamond production increased by 38% to 7.7 million carats, primarily driven by higher production from Jwaneng in Botswana.

Refined platinum group metals (PGM) production for Valterra decreased by 5% for the quarter to September to 981 500 ounces due to a larger drawdown of excess work-in-progress inventory in the prior period.

PGM sales volumes for the period also decreased by 9% to 936 800 ounces, marginally below refined production volumes due to the timing difference in sales recognition, with some sales volumes rolling into October, said Valterra.

“We have however, identified opportunities to optimise our work-in-progress inventory, which – combined with the benefits of our stable and efficient processing assets – will allow us to supplement M&C production, resulting in expected refined production and sales volumes of 3.4 million ounces,” said Craig Miller, Valterra Platinum CEO.

During the quarter under review, Valterra’s own mine production declined 2% compared to the prior period, mainly due to lower production from Mototolo, Amandelbult and Unki in Zimbabwe. This was partially offset by higher production at Mogalakwena.

On a quarter-on-quarter basis, production firmed up by 16%, driven by Amandelbult’s ramp up to steady-state operations.

Mogalakwena increased PGM production by 4% to 225 700 ounces, driven by higher concentrator throughput production from the Unki mine in Zimbabwe declined by 8% to 57 500 PGM ounces mainly due to expected lower grades in the current mining area.

BUSINESS REPORT