| Thu 20 Oct 2011, 8:17 | | AGL - Anglo American Plc - Interim Management Statement |
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AGL
ANAAL
AGL - Anglo American Plc - Interim Management Statement
Anglo American plc
Incorporated in the United Kingdom
(Registration number: 3564138)
Short name: Anglo
Share code: AGL
ISIN number: GB00B1XZS820
Anglo American plc
Interim Management Statement
Production Report for the third quarter ended 30 September 2011
Overview
- Iron ore production increased by 3% to 12.2 million tonnes mainly due to
increased volumes from Kumba`s Sishen Mine
- The commissioning of Kolomela mine commenced successfully during
August 2011.
- Metallurgical Coal - total production (metallurgical and thermal coal)
increased by 5% to 8.0 million tonnes, with a 24% increase and record
production from Australian open cut operations
- Production of metallurgical coal decreased by 4% to 4.0 million
tonnes, due to planned longwall moves at the underground operations.
- Thermal coal production from South Africa and Colombia decreased by 10%
to 16.8 million tonnes, mainly due to industrial action at the South
African operations, partly offset by an 18% increase in production from
Colombia.
- Copper production decreased by 9% to 139,900 tonnes, due to a number of
factors including expected lower grades
- Full year production expected to be marginally higher than 2010,
based on the commissioning of the Los Bronces expansion project in
Q4.
- Nickel(1) production increased by 14% to 6,500 tonnes, as Barro Alto
production continues to ramp up.
- Platinum equivalent refined production increased by 3%, while refined
production decreased by 7% to 647,000 ounces.
- Diamond production increased by 3% to 9.3 million carats despite
industrial actions at operations in South Africa and Namibia.
- Phosphates production from Copebras increased by 10% to 285,000 tonnes.
- Niobium production from Catalao increased by 22% to 1,100 tonnes.
- Los Bronces 278,000 tonnes per annum(2) expansion project in
commissioning phase.
- Codelco announced on 12 October 2011 that it has put a financing facility
in place for its option that it may exercise over a 49% shareholding in
Anglo American Sur (Los Bronces, El Soldado and Chagres smelter) in
Chile. Anglo American received written notice from Codelco on 13 October
2011 stating that it intends to exercise its option. Anglo American is
considering the implications of Codelco`s announcement and written
notice.
Preliminary Results for the full year to 31 December 2011 will be announced on
17 February 2012.
This report forms Anglo American plc`s Interim Management Statement for the
purpose of the UK Listing Authority`s Disclosure and Transparency Rules.
Nickel production from the Nickel business unit
Additional capacity over first three years
Iron Ore and Q3 Q3 Q3 2011 Q2 Q3 2011
Manganese
2011 2010 vs. 2011 vs.
Q3 2010 Q2 2011
Iron ore 000 t 12,183 11,819 3% 11,534 6%
Manganese ore 000 t 808 849 (5)% 716 13%
Manganese 000 t 78 80 (3)% 76 3%
alloys
Attributable
sales volumes
RSA export 000 t 9,167 8,292 11% 9,806 (7)%
iron ore
RSA domestic 000 t 1,538 2,170 (29)% 1,836 (16)%
iron ore
South American 000 t 1,452 927 57% 918 58%
export iron
ore
Iron ore - Total production of 12.2 Mt was 3% higher and 6% higher than Q2
2011.
Production at Sishen Mine has normalised following the weather related
interruptions during Q1 2011. While production from the DMS plant increased
quarter on quarter, the plant`s performance continues to be impacted by mining
feedstock constraints caused by the heavy rainfall experienced during Q1 2011.
In Brazil, record monthly production was achieved at Amapa in September
(419,000 tonnes), following further improvements in the production processes.
Export sales volumes from Sishen Mine increased 11% to 9.2 Mt, despite the
annual maintenance shutdown of the iron ore export channel during August 2011.
South African domestic sales volumes decreased 29% to 1.5 Mt due to reduced
offtake from ArcelorMittal South Africa (AMSA).
The commissioning of Kolomela Mine commenced during August 2011, with 0.3 Mt
of final product produced as part of the hot commissioning of the plant. The
mine remains on track to ramp up to between 4 Mt and 5 Mt in 2012, whilst
ramping up to design capacity of 9 Mtpa in 2013.
The Minas-Rio iron ore project construction is progressing with civil works at
the beneficiation plant and pipeline construction both continuing. First ore
on ship is forecast in the second half of 2013.
Manganese Ore - Production decreased by 5% due to lower concentrator
availability in Australia, offset by production efficiencies mainly from the
Mamatwan mine at Hotazel that delivered a record quarterly production.
Manganese Alloys - Production decreased by 3% due to furnace instability at
Metalloys, offset by changes to the product mix at TEMCO.
Metallurgical Coal(1) Q3 Q3 Q3 2011 Q2 Q3 2011
2011 2010 vs. 2011 vs.
Q3 2010 Q2 2011
Production
Export metallurgical 000 t 4,015 4,197 (4)% 3,949 2%
Thermal 000 t 3,978 3,413 17% 3,088 29%
Weighted average
achieved FOB prices
Export metallurgical US$/t 267 205 30% 276 (3)%
Export thermal US$/t 98 91 8% 103 (5)%
Domestic thermal US$/t 35 30 17% 35 -
Attributable sales
volumes
Export metallurgical 000 t 3,721 4,240 (12)% 3,929 (5)%
Export thermal 000 t 1,878 1,630 15% 1,600 17%
Domestic thermal 000 t 1,843 1,824 1% 1,867 (1)%
(1) In 2011 the Group decided to retain Peace River Coal and to manage it
within the Metallurgical Coal business unit. Information presented includes
Peace River Coal and comparatives have been adjusted accordingly.
Metallurgical Coal - The Australian open cut operations delivered a record
performance following the recovery actions initiated in the first half of the
year, increasing production by 24%. However, planned longwall moves at the
underground operations resulted in total metallurgical coal production
decreasing by 4% to 4.0 Mt.
Thermal coal production from Australia increased by 17% and by 29% compared to
Q2 2011, also as a result of the recovery actions initiated earlier in the
year.
Metallurgical Coal business` production increased 5% to 8.0 million tonnes,
with record export production achieved.
Thermal Coal Q3 Q3 Q3 2011 Q2 Q3 2011
2011 2010 vs. 2011 vs.
Q3 2010 Q2 2011
Production
RSA thermal (non-Eskom) 000 t 5,198 5,813 (11)% 5,264 (1)%
Eskom 000 t 8,751 10,431 (16)% 8,783 -
RSA metallurgical 000 t 76 112 (32)% 84 (10)%
Colombia export thermal 000 t 2,852 2,427 18% 2,538 12%
Weighted average
achieved FOB prices
RSA export thermal US$/t 115 83 39% 122 (6)%
RSA domestic thermal US$/t 22 17 29% 22 -
Colombia export thermal US$/t 103 74 39% 104 (1)%
Attributable sales
volumes
RSA export thermal 000 t 4,605 4,303 7% 3,213 43%
RSA domestic thermal 000 t 9,901 11,835 (16)% 9,866 -
Colombia export thermal 000 t 2,901 2,763 5% 2,853 2%
Thermal Coal - Thermal coal production in South Africa was impacted by
industrial action and geological constraints. This has been partly offset by
Zibulo which continues to ramp up and is expected to reach commercial
production in Q1 2012. Cerrejon, in Colombia, delivered a strong performance
benefiting from a reduction in weather related stoppages.
Achieved export prices in South Africa were higher than 2010, reflecting
favourable market conditions. Thermal Coal sells its export thermal product on
index.
Export sales volumes from South Africa increased due to optimised load out
efficiencies on the operations and an improvement in rail and port
performance.
Copper Q3 Q3 Q3 2011 Q2 Q3 2011
2011 2010 vs. 2011 vs.
Q3 2010 Q2 2011
Copper t 139,900 153,400 (9)% 150,300 (7)%
Copper - Production decreased by 9% to 139,900 tonnes, mainly due to lower
grades at Collahuasi, Los Bronces and Mantos Blancos, and weather related
interruptions at Collahuasi. This was partially offset by higher production at
El Soldado, which benefited from higher ore grades following recent mine
development.
The Los Bronces expansion project remains on schedule for first production in
Q4 2011.
At Collahuasi, commissioning of the phase 1 expansion project is under way to
increase sulphide processing capacity to 150,000 tonnes of ore per day, an
annual average production increment of 19,000 tonnes per year of copper over
the estimated life of mine.
Nickel Q3 Q3 Q3 2011 Q2 Q3 2011
2011 2010 vs. 2011 vs.
Q3 2010 Q2 2011
Nickel t 6,500 5,700 14% 6,600 (2)%
Nickel - Production increased by 14% to 6,500 tonnes due to the commissioning
of Barro Alto which contributed 1,000 tonnes in Q3 2011. At Loma de Niquel,
production was 8% lower than the same period in 2010, due to lower grades and
additional maintenance activities in the quarter.
The Barro Alto plant is continuing to ramp up and will average 40,000 tpa over
its first three years of full production. Barro Alto is expected to reach full
capacity at the end of 2012.
Platinum Q3 Q3 Q3 2011 Q2 Q3 2011
2011 2010 vs. 2011 vs.
Q3 2010 Q2 2011
Refined
Platinum 000 oz 647 697 (7)% 641 1%
Palladium 000 oz 376 405 (7)% 374 1%
Rhodium 000 oz 75 89 (16)% 80 (6)%
Nickel t 4,900 4,300 14% 5,500 (11)%
Equivalent refined
Platinum 000 oz 667 648 3% 593 12%
Platinum - Equivalent refined platinum production was 3% higher mainly due to
the strong ramp up at Mogalakwena and Unki, which more than offset the impact
of safety related stoppages. Refined production decreased by 7% despite higher
output from mining operations due to an increase in pipeline stocks, compared
to a decrease in Q3 2010.
Cash operating costs per equivalent refined platinum ounce increased to
R13,093 in the nine months to 30 September 2011, reflecting higher
consumables, labour and electricity costs. The unit cost target for 2011 has
therefore been revised to R12,900 per equivalent refined platinum ounce.
Palladium, Rhodium & Nickel - Refined production of palladium and rhodium
decreased by 7% and 16% respectively, while nickel increased by 14%. These
variances are due to a different source mix from operations and different
pipeline processing times for each metal.
Diamonds Q3 Q3 Q3 2011 Q2 Q3 2011
2011 2010 vs. 2011 vs.
Q3 2010 Q2 2011
Diamonds 9,305 9,033 3% 8,138 14%
000 carats
Diamonds - Carats recovered increased 3% to 9.3 million carats relative to Q3
2010. Production increased 14% compared to Q2 2011 due to higher productivity
and variations in grade, despite industrial actions at operations in South
Africa and Namibia.
Q3 Q3 Q3 2011 Q2 Q3 2011
Other Mining and
Industrial - Core (1)
2011 2010 vs. 2011 vs.
Q3 2010 Q2 2011
Niobium t 1,100 900 22% 900 22%
Phosphates t 285,000 260,000 10% 260,700 9%
(1) Assets originally identified for divestment as part of the restructuring
programme announced in October 2009, are managed as a separate business unit,
Other Mining and Industrial. In 2011 the Group decided to retain Catalao and
Copebras.
Catalao - Niobium production increased 22% to 1,100 tonnes due to inclusion of
ore from Mine II and Copebras waste resulting in higher production at the
tailings plant. Production from the Boa Vista plant increased as a result of
higher quality ore processed and improved recoveries at the concentration and
metallurgy processes.
Copebras - Phosphates production increased 10% to 285,000 tonnes due to
changes in the production mix reflecting market demand and increased
availability at the plant, as a consequence of the reduced number of
shutdowns.
Production summary
The figures below include the entire output of consolidated entities and the
Group`s attributable share of joint ventures, joint arrangements and
associates where applicable, except for De Beers which is quoted on a 100%
basis.
% Change
Q3 2011 Q3 2011
Q3 Q2 Q1 Q4 Q3 vs. vs.
2011 2011 2011 2010 2010 Q2 2011 Q3 2010
Iron Ore and
Manganese
segment (`000
tonnes)
Iron ore(1) 12,183 11,534 9,945 11,808 11,819 6% 3%
Manganese ore 808 716 541 732 849 13% (5)%
(2)
Manganese 78 76 69 77 80 3% (3)%
alloys (2)(3)
Metallurgical
Coal segment
(`000 tonnes)
Metallurgical 4,015 3,949 2,165 3,892 4,197 2% (4)%
Thermal 3,978 3,088 3,002 3,728 3,413 29% 17%
Thermal Coal
segment
(`000
tonnes)(4)
RSA Thermal 5,198 5,264 5,080 5,885 5,813 (1)% (11)%
(non-Eskom)
RSA 76 84 80 103 112 (10)% (32)%
Metallurgical
Eskom 8,751 8,783 8,275 9,485 10,431 - (16)%
Colombia 2,852 2,538 2,609 2,316 2,427 12% 18%
Thermal
Copper segment 139,900 150,300 138,800 154,400 153,400 (7)% (9)%
(tonnes)(5)
Nickel segment 6,500 6,600 6,100 4,400 5,700 (2)% 14%
(tonnes)(6)
(7)
Platinum
segment
Platinum (`000 647 641 533 872 697 1% (7)%
ounces)
Palladium 376 374 288 503 405 1% (7)%
(`000 ounces)
Rhodium (`000 75 80 86 111 89 (6)% (16)%
ounces)
Nickel 4,900 5,500 4,800 5,000 4,300 (11)% 14%
(tonnes)
Equivalent
refined
Platinum (`000 667 593 568 640 648 12% 3%
ounces)
Diamonds
segment (De
Beers)
(diamonds
recovered -
000 carats)
Total diamonds 9,305 8,138 7,396 8,532 9,033 14% 3%
production for
De Beers
Anglo 4,187 3,662 3,328 3,839 4,065 14% 3%
American`s
share of
diamonds
production for
De Beers
Other Mining
and Industrial
segment
(tonnes) (8)
Niobium 1,100 900 900 1,200 900 22% 22%
Phosphates 285,000 260,700 240,800 270,900 260,000 9% 10%
South Africa 158,000 183,100 173,200 151,000 180,000 (14)% (12)%
Steel Products
Coal
production by
commodity
(`000
tonnes)(4)
Metallurgical 4,091 4,033 2,244 3,995 4,309 1% (5)%
Thermal 12,028 10,890 10,691 11,928 11,653 10% 3%
Eskom 8,751 8,783 8,275 9,485 10,431 - (16)%
(1) Includes 300,000 tonnes of capitalised production from Kolomela (Q2 2011:
nil).
(2) Saleable production.
(3) Production includes Medium Carbon Ferro Manganese.
(4) Includes 822,000 tonnes (Q2 2011: 735,000 tonnes) of capitalised
production from Zibulo (previously Zondagsfontein). The 822,000 tonnes
includes export thermal coal production of 585,000 tonnes (Q2 2011: 509,000
tonnes) and Eskom coal production of 237,000 tonnes (Q2 2011: 226,000 tonnes).
(5) Excludes Platinum and Black Mountain mine copper production.
(6) Excludes Platinum nickel production.
(7) Includes Barro Alto which is currently not in commercial production and
therefore all revenue and related costs associated with 1,000 tonnes (Q2 2011:
1,100 tonnes) of production have been capitalised.
(8) Excludes Tarmac.
Production figures are sometimes more precise than the rounded numbers shown
in this report. The percentage change will reflect the percentage change in
the rounded production figures shown in this report.
Forward looking statements:
This Interim Management Statement contains certain forward looking statements
which involve risk and uncertainty because they relate to events and depend on
circumstances that occur in the future. There are a number of factors that
could cause actual results or developments to differ materially from those
expressed or implied by these forward looking statements.
For further information, please contact:
Media Investors
UK UK
James Wyatt-Tilby Leng Lau
Tel: +44 (0)20 7968 8759 Tel: +44 (0)20 7968
8540
Emily Blyth Caroline Crampton
Tel: +44 (0)20 7968 8481 Tel: +44 (0)20 7968
2192
South Africa Leisha Wemyss
Pranill Ramchander Tel: +44 (0)20 7968
Tel: +27 (0)11 638 2592 8607
Notes to editors:
Anglo American plc is one of the world`s largest mining companies, is
headquartered in the UK and listed on the London and Johannesburg stock
exchanges. Anglo American`s portfolio of mining businesses spans bulk
commodities - iron ore and manganese, metallurgical coal and thermal coal;
base metals - copper and nickel; and precious metals and minerals - in which
it is a global leader in both platinum and diamonds. Anglo American is
committed to the highest standards of safety and responsibility across all its
businesses and geographies and to making a sustainable difference in the
development of the communities around its operations. The company`s mining
operations and extensive pipeline of growth projects are located in southern
Africa, South America, Australia, North America and Asia.
www.angloamerican.com
20 October 2011
Sponsor: UBS South Africa (Pty) Ltd
Date: 20/10/2011 08:17:43 Produced by the JSE SENS Department.
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