Higher production from the giant Grasberg mine in Indonesia helped Freeport-McMoran sell more copper and gold than forecast in the third quarter.
The New York-listed group said it had sold 1.04bn pounds of copper and 837,000 ounces of gold in the three months to September, beating the company’s own guidance of 970m and 700,000 respectively.
Freeport said the better than expected sale figures reflected higher operating rates and ore grades at Grasberg, the world’s biggest copper mine and the company’s flagship asset.
Grasberg is about to move from open pit to underground mining and the company has several big projects under development.
Freeport said production from its Grasberg Block Cave project was scheduled for the first half of 2019, the same time as the company expects operations at the Deep Mill Level Zone to commence.
“As Grasberg transitions from the open pit to the underground, its production is expected to significantly lower in 2019 and 2020, compared to 2018. Metal production is expected to improve significantly by 2021 following a ramp up period,” the company said in third quarter result statement.
In the three months to September, Freeport reported adjusted net income of $514m, or 35 cents a share, up from $492m and 34 cents in the same period a year earlier. That result was slightly ahead of market forecasts.
Chief executive Richard Adkerson said Freeport had delivered a “solid” performance, during a quarter that saw copper prices fell sharply on concerns the US-China trade war could hit global growth and therefore demand for commodities.
“The pending completion of our new long-term partnership with the Indonesia government will enable us to de-risk a world class asset,” Mr Adkerson said, referring to the deal that will see a state-owned Indonesia group take a majority stake in Grasberg.
Freeport and its partner Rio Tinto agreed during the quarter to sell a stake in Grasberg to Inalum via a series of complex deals worth nearly $4bn. Freeport said it expected the deal to close in late 2018 or early 2019 subject to successful resolution of various environmental and regulatory matters.
Source: FT.com
