Johannesburg, South Africa — 13 November 2012 – Shares of global mining giant Anglo American tumbled 3.5% to R246.50 on the Johannesburg Stock Exchange after the company raised the estimated cost of its Minas Rio iron ore project, saying it was likely to cost more than US$8 billion, the higher end of analyst forecasts.
Fin24 reports that analysts have long said that spending on the Brazilian project could rise to at least US$8 billion from previous Anglo forecasts of US$5.8 billion, already twice the original estimates.
The stock was also hit by a trading update from subsidiary Kumba Iron Ore.
Kumba’s shares also took a beating, sliding 2.2% to R529.01 after the producer of the steel making ingredient said full-year earnings would likely fall by at least 20%, hit by a wildcat strike at its Sishen Mine and a decrease in export iron ore prices.
The company says the Sishen strike has cost it 2.6Mt of lost production so far. Attendance rates in Sishen’s mining production area remain low, which is hampering output, Kumba says.
Source: Fin24. For more information, click here.