OZ Minerals looks to have had a strong 2010 and is promising more of the same (prices willing) for 2011.
OZ said yesterday that it expects to produce 110,000 tonnes of copper and up to 205,000 ounces of gold from its Prominent Hill mine in South Australia in 2011, after exceeding production targets in 2010.
The market ignored the news and sent the shares down 3.3% to $1.72, a fall of 6c on the day as mining stocks were generally weaker.
OZ Minerals says total copper production in 2010 was 112,171 tonnes and gold output was 196,400 ounces.
"Copper production of 112,171t exceeded the announced annual guidance of 100,000t to 110,000t.
"Gold production was forecast to be more than 185,000oz for the year and, with favourable reconciliation of gold grades in ore mined and greater volumes of ore processed than initially planned, some 196,400oz was achieved, " OZ said in its December quarter and 2010 production report.
Throughput rates in the plant increased through the year to average 9.5 million tonnes for the year, bettering nameplate capacity of the plant by 19%.
In the December quarter, Prominent Hill produced 25,185 tonnes of copper, down from 26,841 tonnes in the September quarter of 2010.
Gold production in the December 2010 quarter was a record high of 54,128 ounces, up from 51,451 ounces in the September quarter.
"Copper and gold production exceeded targets for the year – outstanding and consistent performance at Prominent Hill, OZ said.
"• Record copper and gold prices and record gold production for the quarter.
"• Strong throughput rates achieved in the plant (are) expected to continue throughout 2011.
"Cash costs of US43.5 cents per pound for the quarter and US46.4 cents for the year place Prominent Hill in the first quartile of global producers," the company said.
OZ Minerals says underground construction is on track for first ore in the first quarter of 2012.
The amount of waste mined is planned to be 65Mt in 2011, increasing to approximately 70Mt in 2012.
"The fourth mining fleet, which is designed to bring forward overburden removal, will be in operation until the end of 2012, as the open pit reaches final design parameters
"In 2011, ore milled throughput is planned to increase to 9.6Mtpa, which, with lower grades of copper ore mined and recoveries at current levels, will see production of between 100,000t and 110,000t of copper maintained. With contribution from the Ankata underground, this level of copper production is expected to be achieved for the life of the open pit.
"Gold production is expected to be between 185,000oz and 205,000oz of gold for the coming years as treatment of gold only ore and recoveries are maintained at levels achieved in 2010.
"In 2011, C1 cash costs are expected to be less than US60c/lb, but this will be dependent on the performance of the gold price and the relative strength of the Australian dollar exchange rate," OZ said.
Meanwhile oil and gas producer, Santos says revenue rose 2% in its 2010 financial year which finished on December 31.
That was despite an 8% fall in production caused mostly by the floods around the Cooper Basin in Central Australia in the second half of the year.
Higher realised prices for oil (up 11% on 2009) and gas, were the main drivers according to Santos’ latest production report, issued yesterday.
Santos says total oil and gas production in the December quarter of 2010 was 12.8 million barrels of oil equivalent (mmboe), down from 12.9 mmboe in the third quarter 2010.
Total oil and gas production for the year was 49.9 mmboe, down 8% from 2009’s 54.4 mmboe.
Santos says oil and gas sales fell 1% in 2010 to 59.2mmboe.
Revenue for the full year rose to $2.228 billion, up from $2.181 billion in 2009.
Santos says it expects 2011 full year production to be in the range of 48 to 52 mmboe.
"While wet weather in the Cooper Basin and Queensland continued to affect the company’s operations, sales gas customer requirements were being met by a combination of existing production and gas withdrawal from storage," chief executive David Knox said.
Santos said the wet weather in the Cooper Basin had restricted access to wells and field infrastructure, but production recovery efforts continued in areas where access was available.
Sales gas and ethane production was three per cent lower in the fourth quarter due to flooding, which was offset by withdrawal from underground storage to meet sales contracts.
Santos said crude oil production of 700,000 barrels in the fourth quarter was 13% higher than in the third quarter of 2010, due to continued focus on high rate wells, "however the ongoing impact of wet weather continued to affect operations."
Santos said quarterly natural gas, ethane and LNG production of 58.9 Petrajoules was in line with the previous quarter. The average realised gas price in 2010 was $4.31 per gigajoule, 5% higher than 2009.
"Quarterly crude oil production was also in line with the previous quarter. The average realised oil price in 2010
