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Global commodities firm BHP reported a 14% increase in the production of copper across operations, on the back of the start-up of the third concentrator at its flagship Escondida mine in northern Chile.
The start-up of the Los Colorados extension project on September 10, paired with higher average copper grades and throughput pushed Escondida's production 23% higher to 268,000t in BHP's 1Q18. The company's financial year 2018 runs July 2017-June 2018.
CEO Andrew Mackenzie said "our transition to lower-cost, high-return, latent capacity projects is delivering results, with first copper production achieved from the Los Colorados extension project at Escondida and Olympic Dam's Southern Mine Area during the quarter."
BHP has said that with the three concentrators running, Escondida should be able to process 375,000t/d, helping the world's largest copper mine to produce 1.2Mt/y through 2025.
QUARTERLY COPPER PERFORMANCE
BHP produced 404,100t copper in the quarter ending in September, up from 354,600t in the same period of last year, the company said in a report on Wednesday.
Quarterly output at Escondida (pictured) on a 100% basis was 196,300t of copper in concentrates and 71,900t of copper in cathodes compared to 147,000t and 70,500t, respectively, in the year-ago period. BHP operates the Escondida and has a 57.5% stake in it.
Escondida's gold and silver production in the quarter was up to 50,525oz and 1,74Moz, from 27,561oz and 1.23Moz, respectively.
BHP's other Chilean copper unit, the Pampa Norte division, which includes the Spence and Cerro Colorado mines, reported a 6.6% drop in output of copper in cathodes to 58,000t in the first financial quarter.
The Melbourne-based company said the decline at Pampa Norte was due to unplanned maintenance at Spence's tank house during the quarter, and despite record material mined at Cerro Colorado and record ore milled at Spence.
Production at Pampa Norte in FY18 is expected to be higher than the prior year, BHP said.
BHP said mineral exploration expenditure during the first financial quarter was US$43mn, of which US$32mn was expensed. Greenfield mineral exploration focused on advancing copper targets in Chile, Ecuador Peru, Canada, Australia and the US.
The 33.8%-owned Antamina mine in Peru contributed 35,900t of copper in concentrate on an equity basis in fiscal Q1 versus 34,100t the year before.
BHP kept its production guidance at Antamina at 125,000t in FY18, as mining continues through a zinc rich ore zone deposit consistent with the mine plan. Zinc guidance for next year is expected to increase to 100,000t from 88,000t.
Antamina saw its quarterly zinc contribution increased 90% to 29,201t, as silver production rose 18.7% to 1.60Moz and lead output climbed to 1,415t from 1,146t. Molybdenum was down to 402t from 561t in the same quarter of last year.
BHP reported quarterly iron ore production of 55.6Mt, up from 57.6Mt in the same three months of FY17.
Mining and processing operations at its Brazilian pellet JV Samarco remain suspended following the tailings dam collapse in November 2015.
BHP expects a FY18 iron ore guidance of 239-243Mt.
Energy coal production at BHP's 33.3%-owned Cerrejón mine in Colombia was down 14.7% to 2.50Mt on an equity basis in the quarter.