Weatherly’s Copper production falls in Q2
Junior base metals producer, Weatherly has announced a reduction in second quarter copper production at its central operations.
Weatherly currently operates two copper mines in the country at Otjihase and new Matchless jointly known as Central Operations. In addition, the company has a 25% stake in China Africa Resources Plc, currently focused on the development of a lead/zinc project at Berg Aukas.
In a statement to shareholders earlier this week, Weatherly says second quarter production from the Central Operations was down to 5780 tonnes of copper concentrate containing 1328 tonnes of copper compared to 6499 tonnes of copper concentrate containing 1470 tonnes of copper in the first quarter of Weatherly’s 2012/2013 financial year.
Production was adversely affected by poor mechanical availability and the short working month of December. But despite the fall in production, mined grades at 1.81% and metal recovery at 92.58% remained strong with cash costs largely unchanged from the previous quarter at US$5,829 per tonne of copper.
During the quarter, the company delivered 1,341 tonnes of copper contained in 5,840 tonnes of concentrate to metal trader Louis Dreyfus at a weighted average price of US$ 8,438 per tonne of copper. Weatherly says it continues to maintain its policy of forward selling a portion of its production up to 18 months ahead.
As at 31 December 2012, the company had cash at bank of US$3.5m equivalent after reducing its loan with Louis Dreyfus to US$4.4m, having made loan repayments of US$0.4m in the quarter. It also has forward contracts of over 3,600 tonnes copper at an average price of US$7,877 per tonne.
During the quarter the Weatherly Board approved a work program for the development of the Old Matchless Mine, which will effectively double the production of the asset with an already sound operating base. It will also enable the company to make increased use of the underutilised Otjihase concentrator and reduce the per unit cash cost of production at Central Operations.
In an eventful second quarter, Weatherly completed the Bankable Feasibility Study for the Tschudi Copper Project. The study evaluated an open-pit, heap leach, solvent extraction, electro-winning project capable of producing 17 000 tonnes per annum of copper with a 11-year mine life.
Rod Webster CEO of Weatherly commented: “Weatherly is moving into a significant period in the company’s life. The progression of the Tschudi Project is set to transform the company from a junior to a mid-sized copper producer.
“2012 was a very successful year for Weatherly. Not only did we announce a substantial profit for the fiscal year ended in June 2012, but most importantly we completed the BFS for Tschudi which will put us onto a growth trajectory over the coming years.
“The Central Operations continue to serve their original strategic purpose of providing Weatherly with a platform to generate cash-flow, enabling us to pull together a strong operating base and establish a team of people capable of driving the business through its next stage of growth.”