Duncan Wanblad, Chief Executive of Anglo American, said: “Our production performance started to pick up in the second quarter of 2022, with operational momentum and our focus on asset resilience positioning us well for a stronger second half of the year. Full year production guidance is unchanged for PGMs, copper and iron ore, increased for diamonds and decreased for steelmaking coal due to longwall ramp-up timing. Overall for the second quarter, production was 9%(1) lower compared with the same quarter in 2021, primarily due to expected lower grades and water availability in Copper, ramp-up of the Aquila longwall in Steelmaking Coal and planned maintenance at the Minas-Rio iron ore operation.
“Our newly commissioned Quellaveco project in Peru delivered first copper concentrate at the start of July and will contribute to our copper production in the second half. This marks a major milestone in our delivery of this world-class long life asset, on time and on budget – testament to the incredible efforts of our workforce and wider stakeholders through the effects of a global pandemic. Quellaveco is expected to add around 10% to our global output once fully operational, central to the margin-enhancing organic growth we are delivering in future-enabling metals and minerals over the next decade.
“As we strive to further enhance Anglo American’s investment case, we are committed to delivering many of the raw materials that are critical to the decarbonisation of global energy and transport systems and to do so sustainably, in line with the evolving expectations of our stakeholders. We are progressing towards our stretching sustainability targets on all fronts. During the quarter, we unveiled the world’s largest hydrogen-powered haul truck, part of our nuGen™ Zero Emission Haulage Solution. This world-first technology at such scale is a vital step towards our commitment to carbon neutrality across our operations by 2040. Our agreement to combine nuGenTM with our engineering partner, First Mode, is designed to accelerate the commercialisation and deployment of this technology across the mining industry and other transport applications.”
Q2 2022 highlights
- Rough diamond production decreased by 4%, reflecting lower grades in Canada and Botswana. Production guidance is increased to 32–34 million carats (previously 30-33 million carats) due to robust demand and strong year-to-date operational performance.
- Metal in concentrate production from our Platinum Group Metals (PGMs) operations was broadly flat, with strong performances at Unki and Mototolo offsetting planned lower grades at Mogalakwena. Unit cost guidance is reduced to c.$950/PGM ounce (previously c.$970/PGM ounce), reflecting the weaker South African rand.
- Copper production decreased by 21% due to planned lower grades and water availability.
- Iron ore production decreased by 8% after a safety intervention at Kumba’s Kolomela mine, as well as planned maintenance at Minas-Rio.
- Steelmaking coal production decreased by 12% as the replacement Aquila longwall ramped up following the planned end of production from Grasstree, as well as high rainfall impacting the open pit operations. Full year guidance is revised to 15–17 million tonnes (previously 17-19 million tonnes) and unit cost revised to c.$110/tonne (previously c.$105/tonne).
Chile – Copper production decreased by 21% to 133,900 tonnes due to planned lower grades and lower water availability.Production from Los Bronces decreased by 24% to 64,300 tonnes due to planned lower grades (0.57% vs 0.68%) as well as lower ore processed (12.0 million tonnes vs 13.2 million tonnes) due to the impact of expected low water availability. At Collahuasi, attributable production decreased by 16% to 62,100 tonnes driven by planned lower grades (1.10% vs 1.29%). Production from El Soldado decreased by 32% to 7,500 tonnes due to planned lower grades (0.50% vs 0.75%).
Chile’s central zone continues to face severe drought conditions, with the two years to June 2022 being the driest since records began, and the outlook continues to remain very dry. Various management initiatives to improve water efficiency and secure alternative sources of water continue to partly mitigate the impact on production.
The H1 2022 average realised price of 401c/lb, includes 145,900 tonnes of copper provisionally priced on 30 June at an average of 374 c/lb.
Peru – First production of copper concentrate from the Quellaveco project was achieved at the start of Q3 2022, marking a major milestone ahead of receiving final regulatory clearance for commercial operations to begin.
Production guidance for 2022 is unchanged at 660,000–750,000 tonnes (Chile 560,000-600,000 tonnes; Peru 100,000-150,000 tonnes). Production is subject to the extent of further Covid-19 related disruptions, water availability in Chile and, in Peru, progress on ramp-up of operations.
Unit cost guidance for 2022 is unchanged at c.147c/lb (Chile c.150c/lb; Peru c.135c/lb). This guidance is subject to the impact of water availability on production volumes in Chile, and progressing the ramp-up of production volumes in Peru.