Rio Tinto’s mined copper production recovers strongly in Q2 08

Rio Tinto reported group attributable mined copper production of 214,900t in the second quarter of this year, representing a 16% increase from first-quarter production of 185,200t and a 15% rise from the 185,600t produced in the year-earlier period (Q2 07). Production of copper in concentrates at the giant Escondida mine in Chile (Rio Tinto 30%) bounced back to 312,700t in Q2 08 from a low 284,700t in the first quarter of this year. It was also comfortably higher than the 305,600t produced in the year-earlier period. At the Kennecott division in the US mined copper production recovered equally sharply to 60,200t in Q2 from 44,700t in Q1 and from 55,600t in Q2 2007. The quarter-on-quarter increase was down to higher average ore grades—0.57% copper in the second quarter, compared with 0.49% in the first quarter. The Palabora mine in South Africa (Rio Tinto 57.7%) produced 26,100t of copper in concentrates during Q2, up from 22,100t in Q1 and up by almost 50% from the 17,600t produced in the year-earlier period—the latter reflecting increased recovery rates from reprocessed secondary material, the company said. Only the Northparkes mine in Australia (Rio Tinto 80%) saw production slide sharply year-on-year to 5,500t from 12,400t. First-quarter production was also low and cumulative mined production over the first half of this year was 10,700t, down from 29,500t in the first half of 2008. Rio Tinto attributed the lower numbers to the treatment of lower-grade stockpile material from the open cut which is being used while the underground section of the mine ramps up. It warned that Northparkes’ production this year is likely to be more than 40% below last year’s 43,100t. Despite the increase in mined copper production in the second quarter of this year, Rio Tinto’s refined copper production fell by 18% to 82,800t in Q2 08 from 100,700t in Q2 2007, although it was a marginal improvement on the preceding quarter (Q1 08), when 78,300t were produced. The main culprit was the Kennecott division in the US, where production slid from 67,900t in the year-earlier period to 49,300t in Q2 08. This is a lag effect of the lower ore grades experienced in the first quarter of this year—something that turned around in the second quarter. Ore grades are expected to improve further over the second half of this year but it will take 2-3 months for this to feed through into improved smelter/refinery operating rates, Rio noted. In the interim, though, the refinery is subject to a 26-day shutdown this month and the smelter to an 11-day shutdown in August. Source: Metals Insider