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Anglo American release 1Q22 production report

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Global Mining Review,

Anglo American plc has released its production report for the first quarter ended 31 March 2022 (1Q22).

Mark Cutifani, Chief Executive of Anglo American until 19 April 2022, said: “Production in the normally slower first quarter was 10% 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 memorandum of understanding 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.”

1Q22 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 oz (previously 4.1 – 4.5 million oz).
  • 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 t (previously 63 – 67 million t).
  • 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 t (previously 20 – 22 million t), subject to regulator approval for restart at the next panel as planned.
  • Full year cost guidance has increased by 9%, reflecting a 4% impact from stronger producer currencies and 3% from inflationary pressures, particularly diesel, as well as the revisions to volume guidance.

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