US-based Freeport-McMoRan in a preliminary release says copper sales in the second quarter of 2020 (April -June) are expected to rise by 8pc from the guidance of 690mn lbs (312,978mt) given in April 2020.
In April 2020, the company revised its operating plan in response to the COVID-19 pandemic while announcing its first quarter (Jan-March 2020) results. Freeport will continue to ramp-up its underground production of Grasberg, Indonesia to boost up low-cost of production of copper and gold. Its initiatives in the US to increase cash flows in 2021 will continue.
The company plans to complete the Lone Star Project in the second half of 2020. Freeport aims to produce 200mn lbs (90,718mt) copper annually.
The company announced to have made progress in resuming production at Cerro Verde. The Peruvian government in March 2020 had announced stringent distancing measures which had impacted the company’s operations. In June, Cerro Verde produced 315,000mt of ore per day, 80 pc of last year’s annual average. The company states operating rates are as per April 2020 operating plan. Operations at El Abra, Chile are consistent with April.
The ramp-up at Grasberg district in Indonesia is progressing as per the plan. In the April -June quarter daily production rates at Block Cave and Deep MLZ (DMLZ), underground mines rose to 54,000mt of ore, 9pc above April 2020 revised plan and 46pc above the first quarter of 2020. The company added that the average combined production climbed up to 70,000mt of ore per day. PT Freeport Indonesia expects that it’s copper and gold production will be double from its 2020 levels to approximate 1.4bn lb (6,35,029mn mt) of copper and 1.4mn ounces of gold.
Freeport expects June quarter earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA) to be approximate $650mn. Detailed second-quarter results are expected on July 23, 2020.