https://www.engineeringnews.co.za

Kumba sees production increase, but outlook remains cautious

23rd April 2015

By: Megan van Wyngaardt

Creamer Media Contributing Editor Online

  

Font size: - +

JOHANNESBURG (miningweekly.com) – JSE-listed Kumba Iron Ore’s production for the first quarter ended March increased 7%, to 12.2-million tons, on the 2014 comparative period, declining 2% quarter-on-quarter.

The company highlighted that its total export sales volumes increased by 22% year-on-year, but also fell 2% compared with the previous quarter, at 11.5-million tons, owing to higher production, improved logistics performance and the use of the multipurpose terminal at the Saldanha port, in the Western Cape.

Domestic sales volumes increased by 1%, compared with the first quarter of 2014, and by 59% quarter-on-quarter to 1.4-million tons. Total finished product stockpile levels were 6.1-million tons.

Kumba’s Sishen mine, in the Northern Cape, produced 8.9-million tons, an increase of 3% on the first three months of 2014, but was 4% lower quarter-on-quarter. It noted that the implementation of an operating model in the North mine continued to yield improved operating equipment productivity.

“The operating model is now being rolled out to the prestrip-mining and heavy-mining-equipment maintenance areas of the mine. Waste removal increased by 27% to 49-million tons, relative to the comparative period. The redesign of the western pushbacks of the pit and increased vertical rate of advance, in conjunction with waste removal run rates, indicate sufficient ore exposure to support our 2015 production guidance of 36-million tons,” the company said in a statement.

Meanwhile, its Kolomela mine produced another solid quarterly performance, in line with achieving full-year guidance of 11-million tons. The mine produced three-million tons for the quarter, an increase of 18% year-on-year and 9% quarter-on-quarter, owing largely to improved plant performance.

Production at Kumba’s troubled Thabazimbi mine, in Limpopo, almost doubled, but decreased by 26% quarter-on-quarter to 0.3-million tons. Thabazimbi currently remained under review, with a decision on its future expected in the near term.

In February, Kumba CE Norman Mbazima advised that, under the circumstances, the mine was “just not making money”, adding that the company was not expecting iron-ore prices to recover this year.

The options available to Kumba included mining the Thabazimbi deposit in a more cost-effective manner, placing the mine on care and maintenance, closing the mine or selling it.

Specialist asset manager Investec noted that Kumba was "undoubtedly feeling the stress of weaker iron-ore prices" and was likely close to break-even at current prices.

"We would expect Thabazimbi to be closed shortly and hope to see operational improvements to enable the company to survive an environment of a protracted $50/t," it commented.

Edited by Tracy Hancock
Creamer Media Contributing Editor

Comments

Showroom

Weir Minerals Africa and Middle East
Weir Minerals Africa and Middle East

Weir Minerals Europe, Middle East and Africa is a global supplier of excellent minerals solutions, including pumps, valves, hydrocyclones,...

VISIT SHOWROOM 
Flameblock
Flameblock

FlameBlock is a proudly South African company that engineers, manufactures and supplies fire intumescent and retardant products to the fire...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.09 0.156s - 156pq - 2rq
Subscribe Now