JOHANNESBURG (miningweekly.com) – Despite what it describes as a “volatile market backdrop” multicommodity giant Glencore achieved across-the-board production improvements in copper, zinc, nickel, ferrochrome and coal for the year ended December 31.

The group cautioned, however, that it planned to cut spending from across its broad portfolio to between $6.5-billion and $6.8-billion in the 2015 fiscal year.

The diversified miner’s own-sourced copper production increased 4% to 1.54-million tons in 2014, principally owing to the ramp-up of the Mutanda mine, in the Democratic Republic of Congo (DRC), from which output rose 31% to 197 000 t over the period.

Copper production from the group’s African operations was 465 000 t, up 17% on that produced in 2013, driven largely by the output gains at Mutanda and a 16%, or 21 800 t, production spike at the nearby Katanga operation, reflecting the mine’s ongoing expansion programme.

The ramp-up at Katanga was expected to continue, while additional back-up power generator capacity was expected to remedy the site’s power availability shortfalls and provide energy for “critical operational items” until completion of the first turbine at the DRC’s Inga hydroelectric dam project later this year.

In South America, the group’s share of copper production from the Collahuasi mine, in Chile, was 207 000 t, up 6% on 2013, owing to higher ore tons milled and marginally higher grades.

The group’s share of Peru-based Antamina’s copper production, meanwhile, shrank 22% to 116 400 t as a result of planned lower grades and recoveries.

Copper production from other South American operations was 347 700 t – marginally higher than that of 2013 – while output from Australia increased 5% year-on-year to 259 100 t.

ZINC
Glencore’s own-sourced zinc production, at 1.38-million tons, remained relatively flat year-on-year, reflecting higher production from the Mount Isa and McArthur River mines, in Australia, and the Perkoa operation, in Burkina Faso, which was offset by lost production from the closures of the Perseverance mine, in the US, and the Canada-based Brunswick mine.

Australian zinc production increased 9% to 661 600 t over the year, reflecting the expansion of the Lady Loretta mine and the commissioning of the Phase 3 expansion at McArthur River, which was expected to increase ore production to five-million tons a year.

In contrast, zinc production from the group’s North American operations declined 30% to 135 800 t, reflecting lost production from the closures of the Perseverance and Brunswick mines.

The group’s remaining global zinc assets lifted output 9% to 318 600 t for the 2014 fiscal year.

NICKEL
Further, Glencore lifted own-sourced nickel production by 3% to 101 000 t as a result of the ramp-up at the Koniambo mine, in New Caledonia, and strong production at the Integrated Nickel Operations, in Canada.

This was somewhat offset by the impact of the Falcondo mine, in the Dominican Republic, as well as the Cosmos and Sinclair mines, in Australia, which were placed on care and maintenance.

The group’s Australian assets produced 36 400 t of own-sourced nickel in 2014, down 9% on the prior year, which reflected the lost production from the Cosmos and Sinclair mines.

The Koniambo operation produced 12 600 t of nickel in ferronickel over the period, as its commissioning and ramp-up phase continued. Production was suspended in December as a result of a metal leak in Line 1 at the metallurgical plant. Regulatory approval had been granted for Line 2 to restart on January 18, while repair work on Line 1 was started.

FERROALLOY ASSETS
Glencore, meanwhile, lifted attributable own-sourced ferrochrome production for the year by 5% to 1.29-million tons, reflecting the ramp-up of the Lion Phase 2 project, in Limpopo, which was progressing to plan and expected to reach full capacity by the middle of the year.

In addition, Glencore produced 157 000 oz of platinum in 2014, while the production of vanadium pentoxide fell 4% to 20.8-million tons over the period.

Total manganese production rose 17% to 224 000 t in the year under review on the back of efficiency improvements in Norway and demand-led production increases in France.

The group’s Sherwin Alumina business, in the US, produced 1.4-million tons of alumina, 14% down on 2013.

“The reduction was owing to a conscious decision to temporarily curtail one of the five digestion units throughout the second half of the year, reflective of weak market conditions for Atlantic alumina, coupled with various power supply issues during the year,” the group outlined.

ENERGY ASSETS
Looking to the performance of Glencore’s energy assets, total coal production increased 6% over the period to 146.3-million tons, largely on the back of productivity improvements and the delivery of various advanced-stage Australian thermal coal projects.

Coking coal production from the Australian operations decreased 18% to six-million tons, mainly relating to cost reduction initiatives that resulted in mine plan and roster changes at the Newlands, Oaky Creek and Collinsville mines.

Productivity improvements at the Australian assets also increased the production of thermal and semisoft coal by 10% to 63.5-million, while, in South Africa, thermal coal output rose 6% to 46.1-million tons.

“The increase reflects inclusion of the Hlagisa opencut mine for a full year in 2014, the benefits of productivity improvements at the Tweefontein underground operations and the opening of the Wonderfontein opencut mine. These increases were tempered by the closure of certain higher cost mines,” said the group.

Meanwhile, Glencore’s oil entitlement for the year increased 47% to 7.4-million barrels, reflecting full-year production from the Alen discovery, in Equatorial Guinea, and Badila, in Chad, as well as increased ownership of the Chad assets.