Fortescue lowers cost
PERTH (miningweekly.com) – Iron-ore major Fortescue Metals has reported higher shipments and lower C1 costs for the quarter ended December.
“The Fortesue team have delivered a strong December quarter with shipments of 42.5-million tonnes bringing the total for the first half of the 2019 financial year to 82.7-million tonnes.
“Our average realised price increased by 7% in the quarter to $48/t, which combined with lower C1 costs of $13/t generated strong cash flows,” said CEO Elizabeth Gaines.
C1 costs for the quarter declined on the back of a reduction in overburden removal, a lower exchange rate and the continued focus on productivity and efficiency, the miner said. These improvements were partially offset by unscheduled downtime as a result of bush fires near the Solomon Hub operation in mid-December.
“The first cargo of our 60.1% iron grade West Pilbara fines product was shipped to China in December and we now expect to deliver between eight-million and ten-million tonnes of this product in 2019,” Gaines said on Thursday.
She noted that initial customer feedback has been excellent, with Fortescue expected to supply some 40-million tonnes a year of the West Pilbara fines from December 2020, once the Eliwana mine and rail development project started operation.
Meanwhile, Fortescue was projecting that iron-ore shipments in the second half of the financial year would be higher than the first, with the miner expecting full year shipments of between 165-million and 173-million tonnes.
The higher volumes in the second half of the financial year were also expected to contribute to lower C1 costs, with full-year costs estimated at the upper end of between $12/t and $13/t.
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