Atlas Iron in ‘stronger position’ – Lawrenson
JOHANNESBURG (miningweekly.com) – Western Australian iron-ore miner Atlas Iron is in a “significantly stronger position” and on track to be in a net cash position by mid-2017, new MD and CEO Cliff Lawrenson said on Tuesday, reporting on the company’s December quarter performance.
Atlas, which earlier this month repaid A$54-million of its debt, shipped four-million wet metric tonnes (wmt) in the December quarter, compared with 4.1-million tonnes in the September quarter, and benefited from a 22% increase in the averaged realised iron-ore price.
The miner sold its iron-ore at A$66/wmt, compared with A$54/wmt in the September quarter, and has hedging contracts in place for many of the March quarter’s shipments at prices equivalent to those realised in the December quarter.
C1 operating cash costs remained unchanged at A$34/wmt free on board, although full cash costs increased to A$55/wmt CFR, owing to an increase in freight costs as a result of higher fuel prices and strong demand for seaborne coal. Freight costs increased by about A$1.50/t, while higher revenue-based payments, including contractor collaboration and royalty payments, comprised the balance of the A$5/t cash cost increase.
Meanwhile, Atlas said that it expected a board decision on the development of the Corunna Downs project, near Marble Bar, in the March quarter. Should the board approve the project, which has the potential to deliver four-million tonnes a year of lump and fines over a five- to six-year mine life, the first shipment is targeted for the March 2018 quarter.
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