TSX-listed Copper Mountain, which operates its namesake mine in Canada and owns a project in Australia, has lowered its full-year production guidance to between 65-million and 75-million pounds, following a weaker first-half performance.
The company previously guided production of 80-million to 90-million pounds for 2022 at an all-in cost (AIC) of $2/lb to $2.50/lb.
Copper Mountain cautioned that its AIC would increase to between $2.75/lb and $3.25/lb, owing to higher-than-planned costs in the first half of 2022 and inflationary pressures.
Production in the second half would be considerably higher than in the first half, as the company begins to mine higher grade ore from Phase 4 of the Copper Mountain main pit in July. The higher grade ore is expected throughout the remainder of 2022 and through 2023, thus the miner reiterated its guidance of 90-million to 105-million pounds for next year.
In the first six months of 2022, the company produced 26.47-million pounds of copper, down from 51.04-million pounds a year earlier. Gold and silver production also decreased.
In the second quarter, the Copper Mountain mine produced 13.3-million pounds of copper, 5 792 oz of gold and 61 628 oz of silver.
The company also reported above-average employee absences, owing to several reasons, including Covid-19 and limited maintenance and operations staffing, which impacted overall mine production.
Contracted labour alleviated this issue, but resulted in higher labour costs. The miner noted that hiring full time replacement equipment operators was progressing well by quarter end with mine production back on track.
The commencement of mining in the North pit was also later than planned owing to regulatory delays of a few months as additional test work was requested on potential acid rock drainage from the North pit.
The mine further suffered supply chain issues, including a lack of available parts for some of the production drills, limiting drill and blasted inventory levels.