Chile's Candelaria helps Lundin Mining beat 2015 guidance

Chile's Candelaria copper mine helped Canadian miner Lundin Mining surpass its 2015 production guidance.

The Chilean asset produced 144,832t of copper last year, above its 138,000-141,000t guidance. Output from Lundin's wholly-owned mines was 233,259t, above its 223,100-229,100t guidance.

Candelaria's outperformance was due primarily to higher than expected mill throughput in Q4, the company said in a statement. The Chilean mine produced 31,875t of copper in the quarter.

Lundin took control of Candelaria from Freeport-McMoRan in October 2014. The US$2bn deal also included contingencies for the US company's 80% stake in the mine.

The remaining 20% is held by Japan's Sumitomo.

2016 GUIDANCE

Lundin also announced its production guidance for the year. At Candelaria the company expects to mine 118,000-123,000t at a C1 cash cost of US$1.55/lb.

Company-wide, production is targeted to reach 241,500-255,000t of copper, 21,000-24,000t nickel and 145,000-155,000t zinc.

In terms of capital expenditures, Lundin plans to spend US$220mn, including US$35mn in capitalized stripping at Candelaria. The figure is below previous estimates due to a deferral of 30Mt of waste being mined from phase 10, resulting in expected cost savings of some US$65mn.

The company is also planning to spend US$70mn at Candelaria's Los Diques tailings facility. Total capex for the project is expected to total US$325mn between 2016 and 2018, in line with previous estimates.

Lundin's exploration budget is expected at US$35mn and US$17mn of the total will go to Candelaria.