REG - Anglo American PLC - Anglo American Production Report Q1 2022
21/04/2022 07:00
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RNS Number : 8186I Anglo American PLC 21 April 2022
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21 April 2022
Anglo American plc
Production Report for the first quarter ended 31 March 2022
Mark Cutifani, Chief Executive of Anglo American until 19 April 2022, said:
"Production in the normally slower first quarter was 10%((1)) lower than the
same period in 2021, impacted by peak Covid-related absenteeism, high rainfall
affecting operations in South Africa and Brazil, and safety and other
operational challenges at metallurgical coal and iron ore operations. This
challenging start to the year highlights the importance of adhering to our
Operating Model to stabilise performance after the necessary disruptions of
the last two years as we adapted to - and now learn to live with - Covid. As a
result, we are updating our platinum group metals, iron ore and metallurgical
coal volume guidance for the full year, and our unit cost guidance for most
product groups to also reflect up to date exchange rates and the inflationary
pressure on many input prices, particularly diesel.
"More broadly, progressing our Sustainable Mining Plan priorities has never
been more relevant or urgent, most notably in relation to energy security,
costs and emissions as we work to ensure our business is competitively
positioned for the long term. During the quarter, we agreed an MOU to partner
with EDF Renewables to secure 100% renewable energy for our operations in
South Africa. This ecosystem approach is a major step towards reducing our
on-site energy requirements, the largest source of our operational emissions,
building on the 100% renewable electricity already secured for our South
America operations by 2023. We also expect to have the world's largest
hydrogen haul truck in action in the next few weeks, proving up this
technology at scale for real world mine conditions, and expected to displace
up to 80% of our on-site diesel emissions."
Q1 2022 highlights
• Rough diamond production increased by 25%, reflecting a strong operational
performance and lower rainfall impact, primarily in Botswana. The Benguela
Gem, diamond recovery vessel, was commissioned ahead of schedule and on
budget, and is expected to add an additional 500,000 carats per year of high
value diamonds to our production.
• Metal in concentrate production from our Platinum Group Metals operations
decreased by 6%, primarily due to high rainfall at Mogalakwena, with full year
guidance revised to 3.9-4.3 million ounces (previously 4.1-4.5 million
ounces).
• Copper production decreased by 13% primarily due to planned lower grades.
The Los Bronces and El Soldado operations and the Chagres smelter were awarded
the Copper Mark in March, recognising responsible copper production practices.
• Iron ore production decreased by 19% as high rainfall and plant issues
affected both Kumba and Minas-Rio, with full year guidance revised to 60-64
million tonnes (previously 63-67 million tonnes).
• Metallurgical coal production decreased by 32% due to the delayed longwall
move at Moranbah and the end of production from Grasstree. The suspended
Grosvenor operation and Aquila life-extension project both started operations
in mid-February. Moranbah was suspended following a fatal underground incident
in late March, with full year guidance revised to 17-19 million tonnes
(previously 20-22 million tonnes), subject to regulator approval for restart
at the next panel as planned.
• Full year cost guidance has increased by 9%((2)), reflecting a 4%((2))
impact from stronger producer currencies and 3%((2)) from inflationary
pressures, particularly diesel, as well as the revisions to volume guidance.
Production Q1 2022 Q1 2021 % vs. Q1 2021
Diamonds (Mct)((3)) 8.9 7.2 25%
Copper (kt)((4)) 140 160 (13)%
Nickel (kt)((5)) 9.3 10.1 (8)%
Platinum group metals (koz)((6)) 956 1,021 (6)%
Iron ore (Mt)((7)) 13.2 16.2 (19)%
Metallurgical coal (Mt) 2.2 3.3 (32)%
Manganese ore (kt) 804 905 (11)%
(1) Copper equivalent production is normalised to reflect the
demerger of the South Africa thermal coal operations and the sale of our
interest in Cerrejón.
(2) Unit cost guidance on a copper equivalent basis is calculated as
the USD cost base (based on unit cost guidance) divided by the copper
equivalent mid-point of production guidance.
(3) De Beers Group production is on a 100% basis, except for the
Gahcho Kué joint venture which is on an attributable 51% basis.
(4) Contained metal basis. Reflects copper production from the
Copper operations in Chile only (excludes copper production from the Platinum
Group Metals business unit).
(5) Reflects nickel production from the Nickel operations in Brazil
only (excludes nickel production from the Platinum Group Metals business
unit).
(6) Produced ounces of metal in concentrate. 5E+Au (platinum,
palladium, rhodium, ruthenium and iridium plus gold). Reflects own mine
production and purchase of concentrate.
(7) Wet basis.
Production and unit costs guidance summary
2022 production and unit costs guidance is summarised as follows:
2022 production guidance((1)) 2022 unit costs guidance((1))
Diamonds((2)) 30-33 Mct c.$65/ct
Copper((3)) 660-750 kt c.147c/lb
(previously c.140c/lb)
Nickel((4)) 40-42 kt c.495c/lb
(previously c.450c/lb)
Platinum Group Metals((5)) 3.9-4.3 Moz c.$970/PGM oz
(previously 4.1-4.5Moz) (previously c.$900/PGM oz)
Iron Ore((6)) 60-64 Mt c.$40/t
(previously 63-67 Mt) (previously c.$35/t)
Metallurgical Coal((7)) 17-19 Mt c.$105/t
(previously 20-22 Mt) (previously c.$85/t)
(1) Subject to the extent of further Covid-19 related disruption.
Unit costs exclude royalties, depreciation and include direct support costs
only. FX rates for 2022 unit costs: ~15 ZAR:USD, ~1.3 AUD:USD, ~5.0 BRL:USD,
~800 CLP:USD, ~4 PEN:USD (previously ~16 ZAR:USD, ~1.4 AUD:USD, ~5.6 BRL:USD,
~830 CLP:USD, ~4 PEN:USD).
(2) Production on a 100% basis, except for the Gahcho Kué joint
venture, which is on an attributable 51% basis, subject to trading conditions.
Venetia continues to transition to underground operations during 2022, with
ramp-up expected from 2023. Unit cost is based on De Beers' share of
production.
(3) Copper business unit only. On a contained-metal basis. Total
copper production is the sum of Chile and Peru: Chile: 560-600 kt and Peru:
100-150 kt. Copper Chile subject to water availability. Unit cost total is a
weighted average based on the mid-point of production guidance. Chile unit
cost is revised to c.150c/lb (previously c.145c/lb). Peru unit cost is revised
to c.135c/lb (previously c.125c/lb) and is based on ramp-up production
volumes, it is therefore highly dependent on production start date.
(4) Nickel operations in Brazil only.
(5) 5E + gold produced metal in concentrate ounces. Includes own
mined production (~65%) and purchased concentrate volumes (~35%). The split of
metals differs for own mined and purchased concentrate, refer to FY2021
results presentation slide 38 for indicative split of own mined volumes. 2022
metal in concentrate production is expected to be 1.8-2.0Moz of platinum
(previously 1.9-2.1Moz), 1.2-1.3Moz of palladium (previously 1.3-1.4Moz) and
0.9-1.0Moz of other PGMs and gold. 5E + gold refined production is expected to
be 4.0-4.4Moz (previously 4.2-4.6Moz), subject to the potential impact of
Eskom load-shedding. Unit cost is per own mined 5E + gold PGMs metal in
concentrate ounce.
(6) Wet basis. Total iron ore is the sum of operations at Minas-Rio
in Brazil and Kumba in South Africa. Minas-Rio: 22-24 Mt (previously 24-26 Mt)
and Kumba: 38-40 Mt (previously 39-41 Mt). Kumba is subject to the third party
rail and port performance, as well as weather-related disruptions. Unit cost
total is a weighted average based on the mid-point of production guidance.
Minas-Rio unit cost is revised to c.$32/t (previously c.$25/t) and Kumba unit
cost is revised to c.$44/t (previously c.$41/t).
(7) Production excludes thermal coal by-product from Australia and
is subject to the timing of the restart of Moranbah longwall mining
operations. FOB unit cost comprises managed operations and excludes royalties
and study costs.
Realised prices
Q1 2022 Q1 2021 Q1 2022 vs Q1 2021 FY 2021
Copper (USc/lb)((1)) 462 421 10 % 453
Nickel (USc/lb) 1,085 747 45 % 773
Platinum Group Metals
Platinum (US$/oz)((2)) 998 1,142 (13) % 1,083
Palladium (US$/oz)((2)) 2,097 2,424 (13) % 2,439
Rhodium (US$/oz)((2)) 17,161 20,224 (15) % 19,613
Basket price (US$/PGM oz)((3)) 2,685 2,219 21 % 2,761
Iron Ore - FOB prices((4)) 168 177 (5) % 157
Kumba Export (US$/wmt)((5)) 169 180 (6) % 161
Minas-Rio (US$/wmt)((6)) 166 170 (2) % 150
Metallurgical Coal - HCC (US$/t)((7)) 373 113 230 % 211
Metallurgical Coal - PCI (US$/t)((7)) 266 94 183 % 138
(1) The realised price for Copper excludes third party sales
volumes.
(2) The realised price excludes trading.
(3) Price for a basket of goods per PGM oz. The dollar basket price
is the net sales revenue from all metals (PGMs, base metals and other metals),
excluding trading, per 5E + gold sold ounces (own mined and purchased
concentrate).
(4) Average realised total iron ore price is a weighted average of
the Kumba and Minas-Rio realised prices.
(5) Average realised export basket price (FOB Saldanha) (wet basis
as product is shipped with ~1.6% moisture). The realised prices differ to
Kumba's standalone results due to sales to other Group companies. Average
realised export basket price (FOB Saldanha) on a dry basis is $172/t (Q1 2021:
$183/t) and this was higher than the dry 62% Fe benchmark price of $124/t (FOB
South Africa, adjusted for freight).
(6) Average realised export basket price (FOB Açu) (wet basis as
product is shipped with ~9% moisture).
(7) Weighted average coal sales price achieved at managed
operations. Australian thermal coal by-product is US$230/t and Q1 2021 was
US$76/t, resulting in a 203% increase. FY 2021 was US$120/t.
De Beers
De Beers((1)) (000 carats) Q1 Q1 Q1 2022 vs. Q1 2021 Q4 Q1 2022 vs. Q4 2021
2022 2021 2021
Botswana 6,184 4,960 25 % 5,236 18 %
Namibia 451 338 33 % 392 15 %
South Africa 1,696 1,161 46 % 1,292 31 %
Canada 604 710 (15) % 771 (22) %
Total carats recovered 8,935 7,169 25 % 7,691 16 %
Rough diamond production increased by 25% to 8.9 million carats, reflecting a
strong operational performance, and higher planned levels of production to
meet continued strong demand for rough diamonds, while Q1 2021 was impacted by
particularly high rainfall in Botswana and at Venetia.
In Botswana, production increased by 25% to 6.2 million carats from increased
processing at both Orapa and Jwaneng, as well as planned higher grades across
the operations.
Namibia production increased by 33% to 0.5 million carats primarily driven by
higher recovery from the crawler vessels, due to lower planned maintenance of
the Mafuta and the early delivery of the new diamond recovery vessel, the
Benguela Gem.
South Africa production increased by 46% to 1.7 million carats due to the
treatment of higher grade ore from the final cut of the open pit.
Production in Canada decreased by 15% to 0.6 million carats, primarily as a
result of treating lower grade ore.
Robust demand for rough diamonds continued into the first quarter following
strong growth in consumer demand over the holiday season, with rough diamond
sales totalling 7.9 million carats (7.0 million carats on a consolidated
basis)((2)) from two Sights((3)), compared with 13.5 million carats (12.7
million carats on a consolidated basis)((2)) from three Sights in Q1 2021, and
7.7 million carats (7.2 million carats on a consolidated basis)((2)) from
three Sights in Q4 2021. However, as we head into the seasonally slower second
quarter of the year, diamond businesses are adopting a more cautious and
watchful approach in light of the war in Ukraine and associated sanctions, as
well as the impact of Covid-19 lockdowns in China.
2022 Guidance
Production guidance((1)) for 2022 is unchanged at 30-33 million carats (100%
basis), subject to trading conditions and the extent of further Covid-19
related disruptions.
Unit cost guidance for 2022 is unchanged at c.$65/ct.
(1) De Beers Group production is on a 100% basis, except for the
Gahcho Kué joint venture which is on an attributable 51% basis.
(2) Consolidated sales volumes exclude De Beers Group's JV partners'
50% proportionate share of sales to entities outside De Beers Group from the
Diamond Trading Company Botswana and the Namibia Diamond Trading Company,
which are included in total sales volume (100% basis).
(3) Due to the completion of Sight 3 in April 2022, the sales will
be recognised in Q2 2022.
De Beers((1)) Q1 Q4 Q3 Q2 Q1 Q1 2022 vs. Q1 2021 Q1 2022 vs. Q4 2021
2022 2021 2021 2021 2021
Carats recovered (000 carats)
100% basis (unless stated)
Jwaneng 3,632 2,679 3,954 3,169 3,091 18 % 36 %
Orapa((2)) 2,552 2,557 2,449 2,558 1,869 37 % 0 %
Total Botswana 6,184 5,236 6,403 5,727 4,960 25 % 18 %
Debmarine Namibia 375 330 309 249 249 51 % 14 %
Namdeb (land operations) 76 62 90 89 89 (15) % 23 %
Total Namibia 451 392 399 338 338 33 % 15 %
Venetia 1,696 1,292 1,577 1,276 1,161 46 % 31 %
Total South Africa 1,696 1,292 1,577 1,276 1,161 46 % 31 %
Gahcho Kué (51% basis) 604 771 797 899 710 (15) % (22) %
Total Canada 604 771 797 899 710 (15) % (22) %
Total carats recovered 8,935 7,691 9,176 8,240 7,169 25 % 16 %
Sales volumes
Total sales volume (100)% (Mct)((3)) 7.9((4)) 7.7 7.8 7.3((5)) 13.5((5)) (41) % 3 %
Consolidated sales volume (Mct)((3)) 7.0((4)) 7.2 7.0 6.5((5)) 12.7((5)) (45) % (3) %
Number of Sights (sales cycles) 2((4)) 3 2 2((5)) 3((5))
(1) De Beers Group production is on a 100% basis, except for the
Gahcho Kué joint venture which is on an attributable 51% basis.
(2) Orapa constitutes the Orapa Regime which includes Orapa,
Letlhakane and Damtshaa.
(3) Consolidated sales volumes exclude De Beers Group's JV partners'
50% proportionate share of sales to entities outside De Beers Group from the
Diamond Trading Company Botswana and the Namibia Diamond Trading Company,
which are included in total sales volume (100% basis).
(4) Due to the completion of Sight 3 in April 2022, the sales will
be recognised in Q2 2022.
(5) Due to ongoing travel restrictions and the timing of Sight 3 at
the end of Q1 2021, the Sight event was extended beyond its normal week-long
duration. As a result, 0.2 Mct (total sales volume, 100% and consolidated
basis) from Sight 3 were recognised in Q2 2021.
Copper
Copper((1)) (tonnes) Q1 Q1 Q1 2022 vs. Q1 2021 Q4 Q1 2022 vs. Q4 2021
2022 2021 2021
Los Bronces 65,400 78,800 (17) % 84,900 (23) %
Collahuasi (44% share) 65,700 71,600 (8) % 66,000 0 %
El Soldado 8,400 9,900 (15) % 9,800 (14) %
Total Copper 139,500 160,300 (13) % 160,700 (13) %
(1) Copper production shown on a contained metal basis. Reflects
copper production from the Copper operations in Chile only (excludes copper
production from the Platinum Group Metals business unit).
Copper production decreased by 13% to 139,500 tonnes due to planned lower
grades.
Production from Los Bronces decreased by 17% to 65,400 tonnes due to planned
lower grades (0.6% vs 0.7%) and lower copper recovery (80% vs 83%). The impact
of expected low water availability following the record low levels of
precipitation in 2021 was offset by initiatives to maximise water efficiency.
At Collahuasi, attributable production decreased by 8% to 65,700 tonnes driven
by planned lower grades (1.2% vs 1.3%) and planned plant maintenance reducing
throughput.
Production from El Soldado decreased by 15% to 8,400 tonnes due to planned
lower grades (0.6% vs 0.7%).
Chile´s central zone continues to face severe drought conditions and the
outlook for the remainder of the year remains very dry.
The average realised price of 462c/lb, includes 154,100 tonnes of copper
provisionally priced on 31 March at an average of 471c/lb.
2022 Guidance
Production guidance for 2022 is unchanged at 660,000-750,000 tonnes (Chile
560,000-600,000 tonnes; Peru 100,000-150,000 tonnes). Production is subject to
the extent of further Covid-19-related disruptions and in Chile, to water
availability.
2022 unit cost guidance for Chile is revised to c.150c/lb (previously
c.145c/lb), reflecting the impact of the stronger Chilean peso, higher input
costs and inflation.
2022 unit cost guidance for Peru is revised to c.135c/lb (previously
c.125c/lb), reflecting the impact of inflation.
Copper((1)) Q1 Q4 Q3 Q2 Q1 Q1 2022 vs. Q1 2021 Q1 2022 vs. Q4 2021
2022 2021 2021 2021 2021
Los Bronces mine((2))
Ore mined 8,976,100 11,056,800 10,512,600 11,403,100 10,812,400 (17) % (19) %
Ore processed - Sulphide 11,142,600 13,293,500 12,715,400 13,168,200 11,520,400 (3) % (16) %
Ore grade processed - 0.62 0.70 0.70 0.68 0.72 (14) % (11) %
Sulphide (% TCu)((3))
Production - Copper cathode 10,100 10,400 9,800 9,800 9,900 2 % (3) %
Production - Copper in concentrate 55,300 74,500 69,800 74,600 68,900 (20) % (26) %
Total production 65,400 84,900 79,600 84,400 78,800 (17) % (23) %
Collahuasi 100% basis
(Anglo American share 44%)
Ore mined 22,004,800 23,940,600 30,327,200 26,943,000 21,220,300 4 % (8) %
Ore processed - Sulphide 13,841,700 13,979,000 12,926,400 14,334,300 14,441,600 (4) % (1) %
Ore grade processed - 1.18 1.18 1.28 1.29 1.26 (6) % 0 %
Sulphide (% TCu)((3))
Production - Copper in concentrate 149,400 150,100 148,300 168,800 162,800 (8) % 0 %
Anglo American's 44% share of copper production for Collahuasi 65,700 66,000 65,300 74,300 71,600 (8) % 0 %
El Soldado mine((2))
Ore mined 611,100 975,500 1,697,800 1,796,600 1,708,600 (64) % (37) %
Ore processed - Sulphide 1,809,700 1,909,400 1,952,000 1,834,800 1,755,100 3 % (5) %
Ore grade processed - 0.57 0.63 0.73 0.75 0.70 (19) % (10) %
Sulphide (% TCu)((3))
Production - Copper in concentrate 8,400 9,800 11,600 11,000 9,900 (15) % (14) %
Chagres Smelter((2))
Ore smelted((4)) 30,900 29,200 30,200 25,400 23,200 33 % 6 %
Production 25,100 28,400 29,200 24,600 22,600 11 % (12) %
Total copper production((5)) 139,500 160,700 156,500 169,700 160,300 (13) % (13) %
Total payable copper production 134,100 154,100 150,100 162,600 154,300 (13) % (13) %
Total sales volumes 132,100 173,400 162,300 157,700 147,700 (11) % (24) %
Total payable sales volumes 126,900 166,200 153,900 149,200 143,200 (11) % (24) %
Third party sales((6)) 65,300 138,500 136,200 82,800 74,000 (12) % (53) %
(1) Excludes copper production from the Platinum Group Metals
business unit. Units shown are tonnes unless stated otherwise.
(2) Anglo American ownership interest of Los Bronces, El Soldado and
the Chagres Smelter is 50.1%. Production is stated at 100% as Anglo American
consolidates these operations.
(3) TCu = total copper.
(4) Copper contained basis.
(5) Total copper production includes Anglo American's 44% interest
in Collahuasi.
(6) Relates to sales of copper not produced by Anglo American
operations.
Nickel
Nickel (tonnes) Q1 Q1 Q1 2022 vs. Q1 2021 Q4 Q1 2022 vs. Q4 2021
2022 2021 2021
Nickel 9,300 10,100 (8) % 10,600 (12) %
Nickel production decreased by 8% to 9,300 tonnes, primarily due to lower ore
grades, as a result of licensing delays at the end of 2021, as well as the
impact of heavy rainfall and unplanned maintenance at Codemin.
2022 Guidance
Production guidance for 2022 is unchanged at 40,000-42,000 tonnes, subject to
the extent of further Covid-19 related disruptions.
2022 unit cost guidance is revised to c.495c/lb (previously c.450c/lb),
reflecting the impact of the stronger Brazilian real and inflation.
Nickel (tonnes) Q1 Q4 Q3 Q2 Q1 Q1 2022 vs. Q1 2021 Q1 2022 vs. Q4 2021
2022 2021 2021 2021 2021
Barro Alto
Ore mined 343,700 719,300 1,190,900 976,200 628,500 (45) % (52) %
Ore processed 643,900 654,400 564,400 641,500 616,700 4 % (2) %
Ore grade processed - %Ni 1.42 1.50 1.64 1.56 1.53 (7) % (5) %
Production 7,900 8,600 8,300 8,800 8,200 (4) % (8) %
Codemin
Ore processed 115,100 141,700 146,800 136,400 136,600 (16) % (19) %
Ore grade processed - %Ni 1.41 1.57 1.60 1.52 1.51 (7) % (10) %
Production 1,400 2,000 2,100 1,800 1,900 (26) % (30) %
Total Nickel production((1)) 9,300 10,600 10,400 10,600 10,100 (8) % (12) %
Sales volumes 9,000 10,400 11,700 9,800 10,200 (12) % (13) %
(1) Excludes nickel production from the Platinum Group Metals
business unit.
Platinum Group Metals (PGMs)
PGMs (000 oz)((1)) Q1 Q1 Q1 2022 vs. Q1 2021 Q4 Q1 2022 vs. Q4 2021
2022 2021 2021
Metal in concentrate production 956 1,021 (6) % 1,103 (13) %
Own mined((2)) 623 695 (10) % 734 (15) %
Purchase of concentrate (POC)((3)) 333 326 2 % 369 (10) %
Refined production((4)) 719 973 (26) % 1,391 (48) %
(1) Ounces refer to troy ounces. PGMs is 5E+Au (platinum, palladium,
rhodium, ruthenium and iridium plus gold).
(2) Includes managed operations and 50% of joint operation
production.
(3) Includes the other 50% of joint operation production, as well as
the purchase of concentrate from third parties.
(4) Refined production excludes toll refined material.
Metal in concentrate production
Own mined production decreased by 10% to 623,100 ounces, primarily due to
lower production at Mogalakwena, partially offset by improved performance at
Mototolo, Amandelbult and Unki. Production at Mogalakwena decreased by 24% to
248,800 ounces as a result of a 17% reduction in grade due to severe
rainstorms as mining was redirected to lower grade areas supplemented by the
draw down of lower grade ore stockpiles, as well as Covid-19 supply chain
disruptions impacting delivery of heavy mining equipment. This was partially
offset by a 3% increase at Amandelbult to 159,900 ounces, reflecting improved
underground mining performance. Production at Unki increased by 5% to 53,300
ounces following the debottlenecking project at the concentrator, completed in
Q4 2021. Production at Mototolo increased by 15% due to higher grade. Joint
operations decreased by 6% to 93,900 ounces.
Purchase of concentrate increased by 2% to 332,900 ounces, primarily due to
the continued recovery of third party volumes from the impact of Covid-19.
Refined production
Refined production decreased by 26% to 718,500 ounces, due to more normalised
throughput, as Q1 2021 benefited from higher than normal work-in-progress
inventory following the ACP Phase A rebuild and commissioning in Q4 2020. In
addition, planned annual maintenance and the annual stock count (including at
the Precious Metal Refinery, which only occurs every three years) resulted in
additional downtime of processing assets in Q1 2022.
Sales
Sales volumes decreased by 26%, in line with refined production.
The average realised basket price of $2,685/PGM ounce reflects a more normal
level of sales of lower priced ruthenium compared to Q1 2021.
2022 Guidance
Production guidance (metal in concentrate) for 2022 is revised to 3.9-4.3
million ounces((1)) (previously 4.1-4.5 million ounces)((1)). Refined
production guidance for 2022 is revised to 4.0-4.4 million ounces (previously
4.2-4.6 million ounces), subject to the potential impact of Eskom
load-shedding. Both are subject to the extent of further Covid-19 related
disruption.
2022 unit cost guidance is revised to c.$970/PGM oz (previously c.$900/PGM
oz), reflecting the impact of the stronger South African rand, lower volumes
and inflation.
(1) Metal in concentrate production is expected to be 1.8-2.0
million ounces of platinum (previously 1.9-2.1 million ounces), 1.2-1.3
million ounces of palladium (previously 1.3-1.4 million ounces) and 0.9-1.0
million ounces of other PGMs and gold. With own-mined output accounting for
~65%.
Q1 Q4 Q3 Q2 Q1 Q1 2022 vs. Q1 2021 Q1 2022 vs. Q4 2021
2022 2021 2021 2021 2021
M&C PGMs production (000 oz)((1)) 956.0 1,103.4 1,116.2 1,057.9 1,021.2 (6) % (13) %
Own mined 623.1 734.2 720.0 709.2 694.9 (10) % (15) %
Mogalakwena 248.8 300.8 276.4 308.3 329.1 (24) % (17) %
Amandelbult 159.9 213.6 218.3 185.3 156.0 3 % (25) %
Unki 53.3 63.2 42.6 47.9 50.9 5 % (16) %
Mototolo 67.2 56.9 69.0 59.9 58.6 15 % 18 %
Joint operations((2)) 93.9 99.7 113.7 107.8 100.3 (6) % (6) %
Purchase of concentrate 332.9 369.2 396.2 348.7 326.3 2 % (10) %
Joint operations((2)) 93.9 99.7 113.7 107.8 100.3 (6) % (6) %
Third parties 239.0 269.5 282.5 240.9 226.0 6 % (11) %
Refined PGMs production (000 oz)((1)(3)) 718.5 1,391.3 1,420.4 1,353.7 973.0 (26) % (48) %
By metal:
Platinum 334.1 653.5 662.9 625.7 457.8 (27) % (49) %
Palladium 228.1 423.2 459.8 427.5 317.0 (28) % (46) %
Rhodium 46.3 97.7 92.2 94.3 63.0 (27) % (53) %
Other PGMs and gold 110.0 216.9 205.5 206.2 135.2 (19) % (49) %
Nickel (tonnes) 4,600 5,700 6,000 5,800 4,800 (4) % (19) %
Tolled material (000 oz)((4)) 154.8 179.5 164.5 153.8 175.9 (12) % (14) %
PGMs sales from production (000 oz)((1)(5)) 838.2 1,285.2 1,361.0 1,437.1 1,131.1 (26) % (35) %
Third party PGMs sales (000 oz)((1)(6)) 400.9 272.9 160.1 116.1 221.5 81 % 47 %
4E head grade (g/t milled)((7)) 3.24 3.49 3.47 3.48 3.54 (8) % (7) %
(1) M&C refers to metal in concentrate. Ounces refer to troy
ounces. PGMs is 5E+Au (platinum, palladium, rhodium, ruthenium and iridium
plus gold).
(2) The joint operations are Modikwa and Kroondal. Platinum owns 50%
of these operations, which is presented under 'Own mined' production, and
purchases the remaining 50% of production, which is presented under 'Purchase
of concentrate.
(3) Refined production excludes toll material.
(4) Ounces refer to troy ounces. Tolled volume measured as the
combined content of: platinum, palladium, rhodium and gold, reflecting the
tolling agreements in place.
(5) PGMs sales volumes from production are generally ~65% own mined
and ~35% purchases of concentrate though this may vary from quarter to
quarter.
(6) Relates to sales of metal not produced by Anglo American
operations.
(7) 4E: the grade measured as the combined content of: platinum,
palladium, rhodium and gold, excludes tolled material. Minor metals are
excluded due to variability.
Iron Ore
Iron Ore (000 t) Q1 Q1 Q1 2022 vs. Q1 2021 Q4 Q1 2022 vs. Q4 2021
2022 2021 2021
Iron Ore((1)) 13,165 16,173 (19) % 15,051 (13) %
Kumba((2)) 8,292 10,555 (21) % 9,701 (15) %
Minas-Rio((3)) 4,873 5,619 (13) % 5,350 (9) %
(1) Total iron ore is the sum of Kumba and Minas-Rio.
(2) Volumes are reported as wet metric tonnes. Product is shipped
with ~1.6% moisture.
(3) Volumes are reported as wet metric tonnes. Product is shipped
with ~9% moisture.
Iron ore production decreased by 19% to 13.2 million tonnes, due to a 21%
decrease at Kumba and a 13% decrease at Minas-Rio.
Kumba - Total production decreased by 21% to 8.3 million tonnes, reflecting
the impact of higher than average rainfall and equipment reliability on plant
performance. Sishen production decreased by 18% to 5.8 million tonnes and
Kolomela production decreased by 29% to 2.5 million tonnes.
Total sales decreased by 9% to 9.3 million tonnes((1)), reflecting logistic
constraints and lower production, supplemented by the drawdown of finished
stock to 5.1 million tonnes((1)).
Kumba's iron (Fe) content averaged 64.0% (Q1 2021: 64.2%), while the average
lump:fines ratio decreased to 65:35 (Q1 2021: 69:31).
The Q1 average realised price of $169/tonne (FOB South Africa, wet basis), was
39% higher than the 62% Fe benchmark price of $122/tonne (FOB South Africa,
adjusted for freight and moisture) due to timing on provisionally priced
volumes as well as the lump and Fe content quality premiums that the Kumba
products attract.
Minas-Rio - Production decreased by 13% to 4.9 million tonnes due to lower
mining fleet and plant availability, impacted by unplanned maintenance and
unusually heavy rainfall.
The Q1 average realised price of $166/tonne (FOB Brazil, wet basis) was higher
than the Metal Bulletin 66 price of $138/tonne (FOB Brazil, adjusted for
freight and moisture), reflecting timing on provisionally priced volumes and
the premium quality of the product, including higher (~67%) Fe content.
2022 Guidance
Production guidance (wet basis) for 2022 is revised to 60-64 million tonnes
(previously 63-67 million tonnes) (Kumba 38-40 million tonnes (previously
39-41 million tonnes); Minas-Rio 22-24 million tonnes (previously 24-26
million tonnes)). Both are subject to the extent of further Covid-19 related
disruption and Kumba is subject to the third party rail and port performance,
as well as weather-related disruptions.
2022 unit cost guidance for Kumba has been revised to c.$44/t (previously
c.$41/t) reflecting the impact of the stronger South African rand, lower
volumes and inflation, principally higher diesel prices.
2022 unit cost guidance for Minas-Rio has been revised to c.$32/t (previously
c.$25/t) reflecting the impact of inflation, the stronger Brazilian real and
lower volumes.
(1) Sales volumes and stock are reported on a wet basis and differ
to Kumba's standalone results due to sales to other Group companies.
Iron Ore (tonnes) Q1 Q4 Q3 Q2 Q1 Q1 2022 vs. Q1 2021 Q1 2022 vs. Q4 2021
2022 2021 2021 2021 2021
Iron Ore production((1)) 13,164,900 15,050,800 16,888,100 15,695,300 16,173,400 (19) % (13) %
Iron Ore sales((1)) 13,828,700 16,775,700 15,818,800 14,973,600 15,716,400 (12) % (18) %
Kumba production 8,292,000 9,701,300 10,788,600 9,817,600 10,554,700 (21) % (15) %
Lump 5,387,700 6,419,900 7,252,800 6,723,700 7,156,100 (25) % (16) %
Fines 2,904,300 3,281,400 3,535,800 3,093,900 3,398,600 (15) % (11) %
Kumba production by mine
Sishen 5,816,100 6,538,200 7,528,300 6,876,800 7,071,200 (18) % (11) %
Kolomela 2,475,900 3,163,100 3,260,300 2,940,800 3,483,500 (29) % (22) %
Kumba sales volumes((2)) 9,332,000 10,690,300 9,965,700 9,406,000 10,230,200 (9) % (13) %
Export iron ore((2)) 9,332,000 10,690,300 9,965,700 9,406,000 10,123,100 (8) % (13) %
Domestic iron ore - - - - 107,100 n/a n/a
Minas-Rio production
Pellet feed (wet basis) 4,872,900 5,349,500 6,099,500 5,877,700 5,618,700 (13) % (9) %
Minas-Rio sales volumes
Export - pellet feed (wet basis) 4,496,700 6,085,400 5,853,100 5,567,600 5,486,200 (18) % (26) %
(1) Total iron ore is the sum of Kumba and Minas-Rio and reported in
wet metric tonnes. Kumba product is shipped with ~1.6% moisture and Minas-Rio
product is shipped with ~9% moisture.
(2) Sales volumes differ to Kumba's standalone results due to sales
to other Group companies.
Metallurgical Coal
Metallurgical Coal((1)) (000 t) Q1 Q1 Q1 2022 vs. Q1 2021 Q4 Q1 2022 vs. Q4 2021
2022 2021 2021
Metallurgical Coal 2,226 3,279 (32) % 4,372 (49) %
(1) Anglo American's attributable share of production.
Export metallurgical coal production decreased by 32% to 2.2 million tonnes
primarily due to the delayed longwall move at Moranbah owing to challenging
geological conditions in the previous panel, as well as the planned end of
production at the Grasstree operation in January 2022.
The Aquila life-extension project, which replaces Grasstree, commenced
longwall operations on 5 February 2022 and will ramp up during the first half
of 2022. At Grosvenor, longwall operations restarted on 21 February 2022
following regulatory approval and will ramp up during the first half of 2022.
Operations at Moranbah were suspended following a fatal incident on 25 March
2022, with preparation activities currently underway for restart at the next
panel as planned, subject to approval from the regulator.
The ratio of hard coking coal production to PCI/semi-soft coking coal was
79:21, slightly higher than in Q1 2021 (77:23), due to the restart of
operations at Grosvenor, which produces premium quality hard coking coal, as
well as lower volumes of PCI coal from Capcoal open cut operations.
The Q1 average realised price for hard coking coal was $373/tonne, and the
benchmark price was $488/tonne. The price realisation decreased to 76% (Q1
2021: 89%) due to higher sales earlier in the quarter ahead of the benchmark
peak as well as a lower contribution of premium hard coking coal from the
underground longwall operations.
2022 Guidance
Production guidance for 2022 is revised to 17-19 million tonnes (previously
20-22 million tonnes), subject to the extent of further Covid-19 related
disruptions and the timing of the restart of Moranbah longwall mining
operations.
2022 unit cost guidance is revised to c.$105/t (previously c.$85/t),
reflecting the impact of lower volumes, the stronger Australian dollar and
inflation, primarily higher fuel costs.
Coal, by product (tonnes)((1)) Q1 Q4 Q3 Q2 Q1 Q1 2022 vs. Q1 2021 Q1 2022 vs. Q4 2021
2022 2021 2021 2021 2021
Production volumes
Metallurgical Coal 2,226,400 4,372,100 4,288,500 2,968,600 3,278,500 (32) % (49) %
Hard Coking Coal 1,753,000 2,922,400 3,567,400 2,319,500 2,511,200 (30) % (40) %
PCI / SSCC 473,400 1,449,700 721,100 649,100 767,300 (38) % (67) %
Export thermal Coal 427,400 341,800 443,800 519,000 372,400 15 % 25 %
Sales volumes
Metallurgical Coal 2,429,700 4,182,400 3,985,800 2,856,300 3,112,300 (22) % (42) %
Hard Coking Coal 1,812,000 2,793,500 3,293,600 2,246,200 2,462,100 (26) % (35) %
PCI / SSCC 617,700 1,388,900 692,200 610,100 650,200 (5) % (56) %
Export thermal Coal 337,900 483,800 560,400 572,000 492,000 (31) % (30) %
(1) Anglo American's attributable share of production.
Metallurgical coal, by operation (tonnes)((1)) Q1 Q4 Q3 Q2 Q1 Q1 2022 vs. Q1 2021 Q1 2022 vs. Q4 2021
2022 2021 2021 2021 2021
Metallurgical Coal 2,226,400 4,372,100 4,288,500 2,968,600 3,278,500 (32) % (49) %
Moranbah 172,800 1,084,300 1,314,700 56,600 595,100 (71) % (84) %
Grosvenor 125,200 52,100 19,500 - - n/a 140 %
Capcoal (incl. Grasstree) 746,400 1,588,700 1,503,500 1,554,100 1,346,600 (45) % (53) %
Dawson 444,900 654,100 659,200 569,800 600,600 (26) % (32) %
Jellinbah 737,100 802,200 791,600 788,100 736,200 0 % (8) %
Other - 190,700 - - - n/a n/a
(1) Anglo American's attributable share of production.
Manganese
Manganese (000 t) Q1 Q1 Q1 2022 vs. Q1 2021 Q4 Q1 2022 vs. Q4 2021
2022 2021 2021
Manganese ore((1)) 804 905 (11) % 835 (4) %
Manganese alloys((1)(2)) - - n/a - n/a
(1) Saleable production.
(2) Production includes medium carbon ferro-manganese.
Manganese ore production decreased by 11% to 803,500 tonnes, primarily due to
scheduled maintenance at the South African operations.
There was no manganese alloy production as the South African smelter has been
on care and maintenance since the Covid-19 lockdown in 2020. The divestment of
the Metalloys business expected to complete during 2022 will not proceed as
certain commercial conditions were not satisfied.
Manganese (tonnes) Q1 Q4 Q3 Q2 Q1 Q1 2022 vs. Q1 2021 Q1 2022 vs. Q4 2021
2022 2021 2021 2021 2021
Samancor production
Manganese ore((1)) 803,500 834,600 1,003,600 940,500 904,500 (11) % (4) %
Manganese alloys((1)(2)) - - - - - n/a n/a
Samancor sales volumes
Manganese ore 846,900 940,200 947,200 980,200 878,200 (4) % (10) %
Manganese alloys - - - - 670 n/a n/a
(1) Saleable production.
(2) Production includes medium carbon ferro-manganese.
Exploration and evaluation
Exploration and evaluation expenditure increased by 2% to $60 million.
Exploration expenditure increased by 26% to $24 million driven by increased
exploration activities, principally for copper, reflecting recovery from the
Covid-19 disruption in Q1 2021. Evaluation expenditure decreased by 10% to $36
million, driven by lower spend in copper and divestment of thermal coal
operations.
Corporate and other activities
For more information on Anglo American's announcements during the period
(excluding our 2021 results), please find links to our Press Releases below:
• 19 Apr 2022 | AGM 2022 - Address to shareholders
(https://www.angloamerican.com/media/press-releases/2022/19-04-2022)
• 14 Apr 2022 | Anglo American updates on carbon emissions, water
stewardship and workplace culture
(https://www.angloamerican.com/media/press-releases/2022/14-04-2022)
• 13 Apr 2022 | Rough diamond sales value for De Beers' third sales cycle of
2022 (https://www.angloamerican.com/media/press-releases/2022/13-04-2022)
• 25 Mar 2022 | Completes sale of remaining shareholding in Thungela
Resources (https://www.angloamerican.com/media/press-releases/2022/25-03-2022)
• 18 Mar 2022 | Announces commissioning of the Benguela Gem diamond recovery
vessel (https://www.angloamerican.com/media/press-releases/2022/18-03-2022a)
• 18 Mar 2022 | Partners with EDF Renewables to secure 100% renewable energy
supply for South Africa operations
(https://www.angloamerican.com/media/press-releases/2022/18-03-2022)
• 16 Mar 2022 | Completes first sea trial using blend of biofuel and very
low sulphur fuel oil to reduce emissions from ocean freight
(https://www.angloamerican.com/media/press-releases/2022/16-03-2022)
• 9 Mar 2022 | Operations in Chile awarded the Copper Mark for responsible
production
(https://www.angloamerican.com/media/press-releases/2022/09-03-2022a)
• 9 Mar 2022 | Rough diamond sales value for De Beers' second sales cycle of
2022 (https://www.angloamerican.com/media/press-releases/2022/09-03-2022)
• 4 Mar 2022 | Statement regarding Ukraine
(https://www.angloamerican.com/media/press-releases/2022/04-03-2022)
• 23 Feb 2022 | Appoints Ian Tyler as Senior Independent Director
(https://www.angloamerican.com/media/press-releases/2022/23-02-2022)
• 21 Feb 2022 | Restarts Grosvenor metallurgical coal operation
(https://www.angloamerican.com/media/press-releases/2022/21-02-2022b)
• 9 Feb 2022 | Starts up new Aquila metallurgical coal mine
(https://www.angloamerican.com/media/press-releases/2022/09-02-2022)
• 2 Feb 2022 | Rough diamond sales value for De Beers' first sales cycle of
2022 (https://www.angloamerican.com/media/press-releases/2022/02-02-2022)
Notes
• This Production Report for the quarter ended 31 March 2022 is unaudited.
• Production figures are sometimes more precise than the rounded numbers
shown in this Production Report.
• Copper equivalent production shows changes in underlying production
volume. It is calculated by expressing each product's volume as revenue,
subsequently converting the revenue into copper equivalent units by dividing
by the copper price (per tonne). Long-term forecast prices are used, in order
that period-on-period comparisons exclude any impact for movements in price.
• Please refer to page 16 for information on forward-looking statements.
In this document, references to "Anglo American", the "Anglo American Group",
the "Group", "we", "us", and "our" are to refer to either Anglo American plc
and its subsidiaries and/or those who work for them generally, or where it is
not necessary to refer to a particular entity, entities or persons. The use of
those generic terms herein is for convenience only, and is in no way
indicative of how the Anglo American Group or any entity within it is
structured, managed or controlled. Anglo American subsidiaries, and their
management, are responsible for their own day-to-day operations, including but
not limited to securing and maintaining all relevant licences and permits,
operational adaptation and implementation of Group policies, management,
training and any applicable local grievance mechanisms. Anglo American
produces group-wide policies and procedures to ensure best uniform practices
and standardisation across the Anglo American Group but is not responsible for
the day to day implementation of such policies. Such policies and procedures
constitute prescribed minimum standards only. Group operating subsidiaries are
responsible for adapting those policies and procedures to reflect local
conditions where appropriate, and for implementation, oversight and monitoring
within their specific businesses.
For further information, please contact:
Media Investors
UK UK
James Wyatt-Tilby Paul Galloway
james.wyatt-tilby@angloamerican.com paul.galloway@angloamerican.com
Tel: +44 (0)20 7968 8759 Tel: +44 (0)20 7968 8718
Marcelo Esquivel Emma Waterworth
marcelo.esquivel@angloamerican.com emma.waterwoth@angloamerican.com
Tel: +44 (0)20 7968 8891 Tel: +44 (0)20 7968 8574
Katie Ryall Juliet Newth
katie.ryall@angloamerican.com juliet.newth@angloamerican.com
Tel: +44 (0)20 7968 8935 Tel: +44 (0)20 7968 8830
South Africa Michelle Jarman
Nevashnee Naicker michelle.jarman@angloamerican.com
nevashnee.naicker@angloamerican.com Tel: +44 (0)20 7968 1494
Tel: +27 (0)11 638 3189
Sibusiso Tshabalala
sibusiso.tshabalala@angloamerican.com
Tel: +27 (0)11 638 2175
Notes to editors:
Anglo American is a leading global mining company and our products are the
essential ingredients in almost every aspect of modern life. Our portfolio of
world-class competitive operations, with a broad range of future development
options, provides many of the future-enabling metals and minerals for a
cleaner, greener, more sustainable world and that meet the fast growing every
day demands of billions of consumers. With our people at the heart of our
business, we use innovative practices and the latest technologies to discover
new resources and to mine, process, move and market our products to our
customers - safely and sustainably.
As a responsible producer of diamonds (through De Beers), copper, platinum
group metals, premium quality iron ore and metallurgical coal for steelmaking,
and nickel - with crop nutrients in development - we are committed to being
carbon neutral across our operations by 2040. More broadly, our Sustainable
Mining Plan commits us to a series of stretching goals to ensure we work
towards a healthy environment, creating thriving communities and building
trust as a corporate leader. We work together with our business partners and
diverse stakeholders to unlock enduring value from precious natural resources
for the benefit of the communities and countries in which we operate, for
society as a whole, and for our shareholders. Anglo American is re-imagining
mining to improve people's lives.
www.angloamerican.com
Forward-looking statements and third-party information:
This announcement includes forward-looking statements. All statements other
than statements of historical facts included in this announcement, including,
without limitation, those regarding Anglo American's financial position,
business, acquisition and divestment strategy, dividend policy, plans and
objectives of management for future operations, prospects and projects
(including development plans and objectives relating to Anglo American's
products, production forecasts and Ore Reserve and Mineral Resource positions)
and sustainability performance related (including environmental, social and
governance) goals, ambitions, targets, visions, milestones and aspirations,
are forward-looking statements. By their nature, such forward-looking
statements involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of Anglo
American or industry results to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements.
Such forward-looking statements are based on numerous assumptions regarding
Anglo American's present and future business strategies and the environment in
which Anglo American will operate in the future. Important factors that could
cause Anglo American's actual results, performance or achievements to differ
materially from those in the forward-looking statements include, among others,
levels of actual production during any period, levels of global demand and
commodity market prices, mineral resource exploration and project development
capabilities and delivery, recovery rates and other operational capabilities,
safety, health or environmental incidents, the effects of global pandemics and
outbreaks of infectious diseases, the impact of attacks from third parties on
our information systems, natural catastrophes or adverse geological
conditions, climate change and extreme weather events, the outcome of
litigation or regulatory proceedings, the availability of mining and
processing equipment, the ability to obtain key inputs in a timely manner, the
ability to produce and transport products profitably, the availability of
necessary infrastructure (including transportation) services, the development,
efficacy and adoption of new technology, challenges in realising resource
estimates or discovering new economic mineralisation, the impact of foreign
currency exchange rates on market prices and operating costs, the availability
of sufficient credit, liquidity and counterparty risks, the effects of
inflation, political uncertainty, tensions and disputes and economic
conditions in relevant areas of the world, evolving societal and stakeholder
requirements and expectations, shortages of skilled employees, the actions of
competitors, activities by courts, regulators and governmental authorities
such as in relation to permitting or forcing closure of mines and ceasing of
operations or maintenance of Anglo American's assets and changes in taxation
or safety, health, environmental or other types of regulation in the countries
where Anglo American operates, conflicts over land and resource ownership
rights and such other risk factors identified in Anglo American's most recent
Annual Report. Forward-looking statements should, therefore, be construed in
light of such risk factors and undue reliance should not be placed on
forward-looking statements.
These forward-looking statements speak only as of the date of this
announcement. Anglo American expressly disclaims any obligation or undertaking
(except as required by applicable law, the City Code on Takeovers and Mergers,
the UK Listing Rules, the Disclosure and Transparency Rules of the Financial
Conduct Authority, the Listings Requirements of the securities exchange of the
JSE Limited in South Africa, the SIX Swiss Exchange, the Botswana Stock
Exchange and the Namibian Stock Exchange and any other applicable regulations)
to release publicly any updates or revisions to any forward-looking statement
contained herein to reflect any change in Anglo American's expectations with
regard thereto or any change in events, conditions or circumstances on which
any such statement is based.
Nothing in this announcement should be interpreted to mean that future
earnings per share of Anglo American will necessarily match or exceed its
historical published earnings per share. Certain statistical and other
information about Anglo American included in this announcement is sourced from
publicly available third party sources. As such it has not been independently
verified and presents the views of those third parties, but may not
necessarily correspond to the views held by Anglo American and Anglo American
expressly disclaims any responsibility for, or liability in respect of, such
information.
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