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Copper Mountain Mining reacts to COVID-19 related market uncertainty

Published by
Global Mining Review,


Copper Mountain Mining Corp. has revised its mine plan and project schedule at its copper mountain mine, located in Southern British Columbia, Canada.

The objective is to maintain solid positive margins and cash flow in response to current market conditions and near-term copper price uncertainty as a result of the coronavirus impact to metal prices. A summary of changes includes:

  • Deferral of Ball Mill No. 3 installation capital expenditures, saving U$22 million in 2020.
  • Reducing operation costs by re-sequencing short term production to lower cost mine phases.
  • Preserving high grade ore in pit No. 3 scheduled for mining in 2020, now to be mined in 2021 for the benefit of expected higher metal prices in the future and to match deferred Ball Mill No. 3 expansion capital expenditures.

The actions allow the company to maintain solid cash flow margins at the mine and run sustainably in the current low copper price environment, without any sacrifice to the long term mine plan. In addition, the revised mine plan also allows the company to continue to be able to fund the mill expansion project internally. Saving the high-grade ore originally planned to be mine in 2020 for 2021 also better matches potential higher copper prices, thereby maximising cash flow generation.

“We are committed to protecting our cash flow and minimising costs given the low and volatile copper price environment that we are currently operating in as a result of the coronavirus impact” said Gil Clausen, Copper Mountain’s President and CEO. “We have raised our mine plan to protect and grow cash margin so that we are able to comfortably meet all our obligations, including debt service, while continuing with key projects, including the installation of the Direct Flotation Reactors. This project requires minimal capital and has a fast payback and high return. We have deferred the major discretionary capital for the installation of Ball Mill No. 3 until we see more certainty and stability in the copper price. These initiatives demonstrate our flexibility and ability to react quickly in response to changing market conditions and metal prices.”

Clausen added: “In periods of low metal prics, such as today, we will be disciplined and orderly in our development and take a prudent approach to cash management. We will not sacrifice the future of our mine by high-grading and deferring stripping that builds a liability in the future. Our operation is well positioned with mining phases that can be readily re-sequenced without negatively impacting the intermediate and long term. While the mine plan we have currently implemented is sustainable longer term at these low copper prices, we believe this market uncertainty is short term and fully anticipate the copper price to recover.”

Read the article online at: https://www.globalminingreview.com/finance-business/11032020/copper-mountain-mining-reacts-to-covid-19-related-market-uncertainty/

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Copper mining news Canadian mining news