Antofagasta Downgrades Guidance After Los Pelambres Pipeline Shutdown -- Update
20 Julio 2022 - 2:22AM
Noticias Dow Jones
By Jaime Llinares Taboada
Antofagasta PLC on Wednesday downgraded 2022 production and cost
guidance after a pipeline problem at its Los Pelambres project
caused copper output to fall 6.5% in the second quarter.
The Chilean copper miner cut full-year production to
640,000-660,000 metric tons from its original guidance of
660,000-690,000 tons.
On May 31, Antofagasta detected a leak in the underground
pipeline that transports concentrate from its Los Pelambres
concentrator plant to the port. Two weeks later, the company warned
that full-year production would be at the lower end of the
660,000-690,000 tons range because the processing plant was
operating at lower rates due to the shutdown of the pipeline.
The pipeline restarted on June 26, but Antofagasta estimates
around 15,000 tons of lost production for the year due to the
issue.
In addition, Los Pelambres is also being affected by regional
drought. Antofagasta said the new production guidance incorporates
a low-probability negative outlook for water availability for the
rest of the year.
On Wednesday, Antofagasta also raised 2022 net cash cost
guidance to $1.65 a pound from $1.55, reflecting inflation in
diesel and other input prices and despite the weakening of the
Chilean peso.
For the second quarter, the group reported copper production of
129,800 tons, down from 138,800 tons in the first quarter. Net cash
costs per pound jumped to $1.90 from $1.75 in the period.
"Reduced production levels and higher costs compared to last
year reflect the expected impact of the drought and the temporary
closure of the concentrate pipeline at Los Pelambres in June, as
well as lower grades at Centinela Concentrates," Chief Executive
Ivan Arriagada said.
The Chilean businessman added that the significant decline in
copper prices since the start of June has reinforced Antofagasta's
commitment to control costs, particularly amid the current
inflationary environment.
Write to Jaime Llinares Taboada at jaime.llinares@wsj.com;
@JaimeLlinaresT
(END) Dow Jones Newswires
July 20, 2022 03:07 ET (07:07 GMT)
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