PERTH (miningweekly.com) – Copper miner Sandfire Resources has reported record sales revenue for the half-year ended December, as strong copper prices reigned.

The ASX-listed miner reported sales revenue of $311.8-million for the six months under review, up from the $256.1-million reported in the previous corresponding period, with payable metal sales increasing from 30 856 t to 32 422 t of copper in the same period, while gold sales decreased from 18 531 oz to 14 462 oz.

Net profits after tax for the interim period increased from $44.4-million at the end of the previous corresponding period, to $55.2-million, while earnings before interest, taxes, depreciation and amortisation increased from $138.3-million to $161.6-million.

Sandfire MD Karl Simich told shareholders that the company’s strong financial results for the first half reflected another impressive and consistent performance by the DeGrussa operations in Australia. This led to record sales revenue, strong operational cash-flows and a 24% increase in net profit after tax.

“DeGrussa remains on track to achieve 2022 guidance of 64 000 t to 68 000 t of contained copper and 30 000 oz to 34 000 oz of contained gold, with the second half of the year also expected to include five months’ contribution from the MATSA operation in Spain.”

Simich said the first half of 2022 was a transformational period for the company.

“In addition to another exemplary operational and financial performance, we were able to successfully leverage our strong foundations in Australia to execute one of the most significant acquisitions seen in the midtier base metals sector globally in recent years.

“The $1.865-billion MATSA deal in September was an on-strategy acquisition which marked the culmination of several years of careful preparation for the company to expand globally,” he said.

“This world-class asset immediately elevates Sandfire into the global base metal league and makes us one of the largest copper-focused producers on the ASX, providing our business with a new long-term cornerstone asset that will help drive our growth for many years to come,” said Simich.

MATSA is a substantial polymetallic mining complex comprising three underground mines and a 4.7-million-tonne-a-year central processing facility and an extensive resource base with significant growth potential.

The surrounding exploration package, comprising a 2 450 km² portfolio of mineral rights in exploration in Spain and neighbouring Portugal, offers substantial long-term exploration upside and organic growth potential.

“With the completion of this acquisition in February, Sandfire is on the way to completing our transition from a single-mine company into a diversified and sustainable international miner, and we are doing so against the backdrop of one of the best commodity market environments seen in over a decade,” said Simich on Monday.

“The combination of surging demand from the renewable energy and electric vehicle sectors, together with declining metal stockpiles and supply-side tightness exacerbated by global supply chain instability, has seen the copper price surge to new highs, with further upside expected.”

Simich noted that as well as expanding through acquisition, Sandfire also grew organically during the first half of 2022, with construction of the Motheo copper mine in Botswana stepping up.

“Notwithstanding the challenges experienced as a result of the onset and spread of the Omicron variant of Covid-19, our construction teams have been doing an incredible job, keeping this large-scale construction project on schedule and on-budget toward first production next year.”

The base-case operation at Motheo would require a capital investment of $259-million, and based on a 3.2-million-tonne-a-year operation, deliver 30 000 t/y of contained copper and 1.2-million ounces of contained silver over an initial mine life of 12.5 years.

Simich told shareholders that 2022 and 2023 would be transitional years for Sandfire, underpinned by a strong and growing production base at MATSA.

“DeGrussa production will phase out post the first quarter of 2023, to be replaced towards the end of 2023 by new production from the Motheo copper mine in Botswana, where we expect to scale up in 2024 with the development of the satellite A4 deposit.

“We are also looking to progress the development of our Black Butte copper project in the US, and with further organic growth opportunities, support our aspirational vision to more than double production towards 300 000 t of copper equivalent by the end of this decade.”