“2017 was a further consecutive year of record delivery for Kenmare Resources,” says MD, Michael Carvill.
“Both production and shipments of all products were at record levels. Production in 2018 is expected to moderate slightly, mainly due to lower opening stockpiles, though ilmenite shipment volumes are expected to be maintained as finished goods inventory is drawn down.
“In 2018, Kenmare Resources will upgrade capacity of Wet Concentrator Plant B by up to 20% uplift in capacity. Further options are being examined which will both address grade reduction in future years and facilitate an increase in ilmenite production beyond 1 Mtpa.
“Average received prices for H1 2018 are expected to continue to show improvement on H2 2017, benefiting from new contract prices and higher spot prices, particularly for zircon,” explains Carvill.
An overview of Kenmare’s 2017:
- Record annual production of ilmenite, rutile and zircon – achieving production guidance for all
- Ilmenite production increased 11% to 998 200 tons (2016: 903 300 tons)
- Zircon production increased 9% to 74 000 tons (2016: 68 200 tons)
- Heavy mineral concentrate production decreased 6% to 1 323 000 tons (2016: 1 405 500 tons)
- Total shipments of finished products were up 2% to 1 040 400 tons (2016: 1 024 200 tons)
- Production guidance range mid-point of 950 000 tons of ilmenite production in 2018 (2017: 998 200 tons)
- Prices increased for all products during 2017
- Favorable demand outlook for ilmenite and zircon markets in 2018
- Net debt declined to US$34.1 million (2016: $44.8 million)
Production in 2018 is expected to moderate slightly, mainly due to lower opening heavy mineral concentrate stockpiles, though ilmenite shipment volumes are expected to be maintained as finished goods inventory is drawn down.
Work is on-going to optimize increased mining capacity to offset grade reduction in the Namalope Zone in the coming years.
$19 million has been approved for expenditure on growth projects and studies in 2018, the main elements of which are represented by the WCP B upgrade project, a monazite concentrate project and feasibility studies to increase mining capacity.
Approval of further capital expenditure by the board will be subject to, inter alia, positive outcomes from feasibility studies, attractive financial returns, and supportive market conditions.
Sustaining capital costs in 2018 are expected to be approximately $22 million.
Feature image credit: Kenmare Resources