PERTH (miningweekly.com) – Copper/gold miner Oz Minerals has increased its full year production expectations following a strong second quarter, prompting the miner to reinvest some of its deferred capital expenditure.

The miner on Wednesday increased its copper production targets for the full 2020 from the previous estimate of between 83 000 t and 100 000 t to between 88 000 t and 105 000 t, while the gold production forecast has been increased from between 217 000 oz and 234 000 oz to between 227 000 oz and 249 000 oz.

Copper production in the June quarter reached 24 577 t, which was up from the 20 231 t produced in the previous quarter, with the Prominent Hill mine delivering 15 065 t, Carrapateena nearly quadrupled production from 2 495 t to 7 170 t, and the Carajas project delivering 2 342 t of copper during the quarter.

Gold production for the quarter was also higher compared with the first quarter, increasing from 55 606 oz to 68 740 oz.

Prominent Hill contributed 52 725 oz of gold during the June quarter, up from the 49 049 oz in the previous quarter, production at Carrapateena increased from 5 041 oz to 14 423 oz, while Carajas gold production remained stable at 1 592 oz.

“A strong first half performance has seen guided production upgraded at both Prominent Hill and Carrapateena, with associated all-in sustaining cost (AISC) and C1 cost reductions assisted by higher gold production, an increase in the assumed 2020 gold price to $1 620/oz and favourable exchange rates,” said Oz Minerals MD and CEO Andrew Cole.

C1 cost estimates for the full year have declined from between 65c/lb and 75c/lb to between 10c/lb and 25c/lb, while AISC estimates have declined from between 115c/lb and 130c/lb to between 70c/lb and 85c/lb.

“The ramp-up at Carrapateena has continued to exceed expectations with increases to both copper and gold production and lower all-in sustaining costs and C1 costs now expected for 2020. This strong performance has provided the confidence to release some A$45-million of the A$150-million deferred expenditure announced in March that will benefit production beyond 2020,” Cole said.

Oz Minerals in March this year announced the deferral of some A$150-million in overall growth capital, exploration and study expenditure, which was implemented along with company-wide cost savings.

Capital cost cuts were made with the indefinite delay of equipment acquisition at Pedra Branca and Antas, which will continue on a contract mining basis, and the deferral of significant capital spend at Carrapateena until 2021.

“We maintain full flexibility to again restrict this spend should it be required in this dynamic operating environment and will continue to assess future cash requirements against this backdrop.”

Meanwhile, Cole noted that the development of the Carajas hub, in Brazil, was progressing well, with the first Pedra Branca run-of-mine ore scheduled to be trucked to the Carajas hub for processing in the third quarter of this year.

“Ore sorting equipment has been installed and is operating at Antas for trial, and production remains on track for full year guidance,” he added.