January 24, 2018 / 8:50 AM / 3 months ago

Chilean miner Antofagasta posts lower Q4 output, expects higher costs

LONDON, Jan 24 (Reuters) - Chilean copper producer Antofagasta posted on Wednesday lower fourth quarter production due to lower grades at its Centinela mine and said it expected its 2018 costs to be higher.

Production by the London-listed miner in the fourth quarter of 2017 fell 1.3 percent to 177,800 tonnes compared to the previous quarter. This brought 2017 production to 704,300 tonnes, a 0.7 percent decline on the previous year.

For the full year, lower grades at Los Pambres and Centinela mines were offset by Encuentro Oxides project coming into production in October and the ramp up of Antucoya mine in 2016.

Net cash costs in 2017 were 4.2 percent higher at $1.25 per pound and were 15.3 percent higher in the last quarter at $1.36 per pound.

The company said spending in 2018 should reach to $1 billion while the production forecast was maintained at between 705,000 to 740,000 tonnes.

“Overall, a weak finish to 2017,” said Canaccord Genuity analyst Tim Huff, citing lower quarterly production and the expected increase in costs.

Meanwhile, silver miner Fresnillo posted record annual silver production of 58.7 million ounces which was a 16.6 percent increase on the previous year as two projects came on stream.

Reporting by Zandi Shabalala; Editing by Edmund Blair

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