Lundin Mining Sees Increasing Production Through 2024

The company provided guidance of 258,000-282,000 tonnes of copper in 2022, dipping in 2023 before increasing again in 2024 to 262,000-282,000t.

Output at Candelaria is set to increase due to improved copper head grades and achievement of planned processing rates as initiatives to debottleneck the plant pebble crushing circuit are realised in early 2023. Over the guidance period, total mill throughput is forecast to range between 27-28Mtpy.

Lundin also produces copper at its Chapada gold mine in Brazil and at Neves-Corvo in Portugal.

Zinc production is forecast to increase to 188,000-203,000t in 2022 as the Neves-Corvo expansion ramps up and the near-term production profile at Zinkgruvan in Sweden improves.

Zinc production at Neves-Corvo is guided to increase over 65% in 2022, to 110,000-120,000t, as the expansion ramps-up and going on to design throughput in 2023 with forecast production of 142,000-152,000t. At Zinkgruvan, zinc production guidance has increased 14% for 2022 and 11% for 2023, with forecast higher head grades and improved metal recoveries.

Gold production is forecast to be 153,000-163,000 ounces in 2022, and will remain at a similar level throughout the period, of which about 85,000oz are unencumbered and will receive full market pricing.

Candelaria’s cash costs are expected to be about US$1.55/lb copper in 2022, similar to 2021 levels, after by-product credits. At Chapada, cash costs are expected to be about $1.60/lb copper in 2022, after unencumbered gold by-product credits. Neves-Corvo cash costs for 2022 are expected to improve to about $1.80/lb copper, after zinc and lead by-product credits. Zinkgruvan’s cash costs for 2022 are expected to be about 55c/lb zinc after copper and lead by-product credits.

Lundin forecasts 2022 capital expenditures to be $630 million including deferrals from 2021. The majority of these expenditures are for open pit waste stripping, underground mine development and tailings storage facility and water management works.

Exploration expenditures are planned to be $45 million in 2022 with $40 million to be spent on in-mine and near-mine targets ($15 million at Candelaria, $10 million at Chapada, $8 million at Neves-Corvo, $5 million at Zinkgruvan and $2 million at Eagle). The remaining $5 million is planned to advance activities on exploration stage and new business development projects.

Shares in Lundin Mining are trading at C$10.34, valuing the company at $7.6 billion.