OZ Minerals Limited 

OZL Details

Strong production and lower costs in Q2FY17: OZ Minerals Limited (ASX:OZL) has reported a strong second quarter with production of 28,163 tons of copper and 32,136 ounces of gold from Prominent Hill. The ramp up in production over the prior quarter was driven by an increase in underground ore mined, and remains on track to achieve full year guidance. Further, the second permanent underground access decline is on schedule for breakthrough in late August, which will assist the underground ore production ramp up through the second half of the year.Importantly, payable copper and gold volume increases saw All-In Sustaining Costs (AISC) and C1 costs materially lower than the prior quarter, with both remaining on track to meet annual guidance.


Q2FY17 production summary; (Source: Company reports)

Ore mined in the quarter was 3.7Mt, consisting of 3.41Mt of copper-gold ore and 0.25Mt of gold only ore, while the waste movement of 1.9Mt was 14% below the prior quarter. The strip ratio decreased to 0.5:1 from 0.6:1 in the prior quarter, in line with the mine plan, with the full year ratio expected to remain at the guided level of circa 0.5 times. The open pit demobilization of one excavator and associated reduction in truck fleet (five trucks) was completed during the quarter, leaving a remaining fleet of 12 trucks and a smaller primary excavator. The gold hedging strategy implemented in April 2016 was extended by another 17,500 ounces during the quarter, bringing the total amount of gold hedged to 236,933 ounces at an average price of A$1,760/oz., and full exposure to the spot gold price continues to be maintained until mid-2018. The company has paid 2016 income tax provision of $69 million in June.


OZL Daily chart; (Source: Company reports)

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