COPPER: First Quantum cuts costs at Cobre Panama development

TORONTO – Weak metal prices are causing another copper producer to tighten its purse strings. First Quantum Minerals says its focus will continue to be on profitability and cash flow from its mining operations.

One project with a positive outcome of this belt tightening is the Cobre Panama copper development in Panama. The estimated capital cost of the project has been revised downward to US$5.95 billion, down 7% with the potential for further improvements.

First Quantum has spent approximately US$2.62 billion as the project moves toward start-up in late 2017. The company revised its metal streaming agreement with Franco-Nevada Corp. moving the first payment of US$330 million to US$340 million to October. Partner KPMC is committed to spending its share, a further US$666 million, toward completion.

The Cobre Panama development is about 35% complete. The port is now fully operational and receiving direct international shipments. Priority is being given to finishing the power station.

Elsewhere, the Sentinel copper mine, part of the Trident project in Zambia, is nearing commercial production, and the power supply in that country is becoming more reliable.

First Quantum said copper production for 2015 is now expected to be between 385,000 and 410,000 tonnes, excluding Sentinel commissioning production of between 30,000 and 40,000 tonnes. The company has lowered its C1 cost estimate to between US$1.20 and $1.35 per pound.

More information is available at First-Quantum.com.