Shareholders in OZ Minerals will not miss out when the company reveals its interim financial results next month along with an updated capital management plan.
OZ Minerals made it clear yesterday that it will make sure shareholders receive regular returns in the update.
OZ has spent or is in the process of spending upwards of $1.5 billion on a new mine, a takeover, capex and $45 million on exploration around its existing mines and prospects, as well as in the rapidly evolving West Musgrave region where a major resource seems to be in the process of being outlined.
It is spending $1 billion on building a new mine at Carrapateena deposit to the north of the existing Prominent hill operation (which is being expanded), $45 million this year on exploration and project studies and $201 million (plus shares) buying control of junior explorer Avanco Resources and its Brazilian prospects.
OZ said in yesterday’s June quarter and half year exploration and production report that it had a cash balance of $454 million after Avanco shareholder payments ($201 million), investment into Carrapateena ($78 million) and tax payments ($100 million).
The company said the Prominent Hill mine continued its strong performance with 27,131 tonnes of copper and 28,121 ounces of gold produced for the quarter.
That was after 27,466 tonnes of copper and 30,873 ounces of gold were produced in the first quarter, making a total of 54,597 tonnes of copper and 58,994 ounces of gold for the first quarter.
That was slightly ahead of the 53,242 tonnes of copper and 58,271 ounces of gold produced in the first half of 2017.
That puts the company well on the way to achieving guidance of 100,000 – 110,000 tonnes of copper and 120,000 – 130,000 ounces of gold for the full year.
CEO Andrew Cole said in the report ((https://www.asx.com.au/asxpdf/20180719/pdf/43wmff2zlv8pq0.pdf))
“This was a business-as-usual quarter for operations and projects across the company, with good progress made on delivering to our plans and growth strategy.
“Prominent Hill saw solid, consistent production that is tracking to guidance. With the drawdown of the open pit stockpile now in place for a full quarter, AISC and C1 costs are lower with no further open pit mining costs or related overheads to be incurred.
“Carrapateena decline development continues its excellent progress and has safely transitioned to Downer EDI, our new underground mining partner. Airstrip construction is complete and processing plant and non-process infrastructure construction is underway. Province expansion drilling at Khamsin has also returned some very encouraging results.
“West Musgrave pre-feasibility study activities have focussed on heritage clearances with traditional owners, infill drilling and renewable power investigation. The regional exploration program has intersected Massive Sulphide mineralisation at nearby Yappsu, just six kilometres from Nebo Babel and mineralisation appears open in all directions.
“The takeover of Avanco is now in compulsory acquisition stage, having received acceptances from over 90% of Avanco shareholders in late June. We have a dedicated integration team in Brazil working on optimising the asset portfolio and accelerating growth as part of a holistic business plan. We will release a detailed Brazil strategy later in the year,” he added
OZ shares were up 2.5% to $9.23 at the close.
