Iron ore miner Kumba has revised its operational guidance for the full year 2020 and the outlook on production and unit costs going forward.
“Kumba continues to focus on the safety, health and wellbeing of our workforce and we are committed to delivering on our value drivers of quality, efficiency and cost reduction which are instrumental in unlocking the full value from our world class assets,” says Kumba chief executive Themba Mkhwanazi.
“To ensure that the value chain is balanced, and finished stock is maintained at optimal levels, production is likely to be closer to the lower end of the guidance range,” he notes.
As a result, has updated its production guidance to c.37 Mt (previously 37-39 Mt) and its sales guidance to c.39 Mt (previously 38-40 Mt), following the completion of the annual rail and port maintenance by Transnet.
The on-mine unit cost guidance for Sishen has decreased to between R380 and R390/t (previously R385-395/t), whilst Kolomela’s has increased to between R290 and R300/t (previously R280-290/t).
Kumba’s C1 unit cost guidance for production of ~US$32/t is unchanged.
“2020 has presented a unique set of challenges and it is pleasing to see the strong commitment across our operations to produce responsibly and ensure that we end the year in good shape and are well positioned for 2021 and the longer term,” says Mkhwanazi.
Full year 2020 guidance
▪ Total sales of ~39 Mt (previously 38-40 Mt)
▪ Total production of ~37 Mt (previously 37-39 Mt)
– Sishen: ~25.5 Mt (previously ~26 Mt)
– Kolomela: ~11.5 Mt (previously ~12 Mt)
▪ Waste stripping:
– Sishen: 145 – 160 Mt
– Kolomela: 45 – 55 Mt
▪ Total C1 unit cost of ~US$32/t
▪ On mine unit costs:
– Sishen: R380 – 390/t (previously R385-395/t)
– Kolomela: R290 – R300/t (previously (R280 – R290/t)
▪ Total capital expenditure of ~R6.1 billion (previously R5.6-6.1 billion)
Total production 2021 – 2023 guidance
2021F: 40-41 Mt (previously 42-43 Mt)
2022F: 41-42 Mt (previously 42-43 Mt)
2023F: 41-42 Mt (new guidance)
C1 unit cost (FOB US$/t) 2021 guidance
2021F: ~34 Mt (new guidance)