Diversified miner South32 said yesterday that despite macroeconomic conditions creating headwinds for many commodities, its 2024 financial year production guidance remained unchanged across all operations.
In its quarterly report released on Monday, South32 CEO Graham Kerr said: “We have maintained annual production guidance for all of our operations with a strong start to the year at our manganese operations, a 34% increase in production at Brazil Alumina and continued growth in low-carbon aluminium volumes.”
The group reported that the Manganese ore production increased by 4%, with a quarterly record for South African manganese and a strong start to the year for Australian manganese.
“Alumina production increased by 3%, as Brazil Alumina recovered from temporary port infrastructure outages, while Worsley Alumina completed planned calciner maintenance. Hillside Aluminium continued to test its maximum technical capacity, and low-carbon aluminium production from Brazil Aluminium and Mozal Aluminium increased by 2%," it said.
According to the group, Illawarra Metallurgical Coal production decreased by 33% as the operation commenced an extended planned longwall move at the Dendrobium mine. A new industrial agreement covering deputies at the Appin mine was finalised after the end of the quarter.
“Sierra Gorda payable copper production decreased by 8%, as higher throughput delivered by the plant de-bottlenecking project was offset by lower planned copper grades.
“Cannington payable zinc equivalent production decreased by 6% due to lower planned zinc grades in the quarter, with the operation remaining on track to deliver 11% production growth in the 2024 financial year,” it said.
Cerro Matoso payable nickel production decreased by 19%, as the operation was impacted by planned plant maintenance and a temporary disruption to gas supply.
“We commenced federal permitting at our Hermosa project under FAST-41 and remain on track to complete the feasibility study for the Taylor zinc-lead-silver deposit in the second quarter of the 2024 financial year,” it said.
The group said net debt increased by $299 million (R5.6m) to $782m during the September 2023 quarter, with lower commodity prices and a temporary build-in working capital of $250m as it made payments accrued in the prior period, and its high-value aluminium inventory increased by $100m.
“We expect to lower our aluminium inventory position to normalised levels during the December 2023 quarter, as Brazil Aluminium makes its first planned export sales and we draw down inventory in our southern African value chain,” it said.
The group said it invested $71m in the Hermosa project for growth capital expenditure as it progressed construction of key infrastructure and commenced federal permitting for its Taylor zinc-lead-silver and Clark battery-grade manganese deposits.
In the Greenfield exploration, the group invested $9m in its greenfield exploration opportunities during the September 2023 quarter, including a first-time exploration drilling program at its 100% owned Roosevelt project in Alaska.