* Copper output grew 73 pct in 2016, further growth seen
* Share price adds to 60 pct gains this year
* Lowest cash costs in the world
LONDON, Feb 23 (Reuters) - Kaz Minerals, a copper company focused on large scale, low-cost open pit mining in Kazakhstan, said on Thursday its earnings had surged as it brought new output online against a wider backdrop of tightening supply that has boosted prices.
Kaz Minerals has two new major copper projects Bozshakol and Aktogay, which it describes as world-class open-pit mines — cheaper than having to extract from deep underground.
Earnings before interest, tax, depreciation and amortisation (EBITDA) were $351 million in 2016 versus $202 million in 2015.
It said in 2016 it had achieved 73 percent growth in copper production to 140,000 tonnes and the guidance for 2017 was 225,000 to 260,000 tonnes.
“Kaz Minerals is now well positioned to achieve its target of 300,000 tonnes of copper production in 2018, delivering significant copper growth with low operating costs into a strengthening market,” Chief Executive Oleg Novachuk said in a statement.
He said the 73 percent rise in copper output was at “an industry leading” net cash cost of 59 cents per pound, the cheapest among pure copper producers.
The first of the two major new projects, Bozshakol, has reached commercial production and Aktogay follow suit this year as the ramp up in production continues.
In a note, Credit Suisse said EBITDA was ahead of consensus but rated the stock neutral after a 60 percent run-up in the share price this year.
“The shares have performed extremely well and we think the valuation and risk reward is now less compelling,” it said.
By 1300 GMT, Kaz Minerals shares were 1.7 percent higher, while the overall sector was around flat.
Glencore, which also reported its results on Thursday, saw a strengthening market on good Chinese demand and limited new supply.
Industry-wide it said capital expenditure had shrunk from around $71 billion in 2012 to $25 billion in 2016 and the pipeline of new copper projects was around half that before the commodities super-cycle.
On the London Metal Exchange, benchmark copper jumped 18 percent last year, its first annual rise since 2012, and this month hit a 21-month high above $6,200 a tonne following disruption at major mines. nL4N1G82N6] (Reporting by Barbara Lewis; Additional reporting by Sanjeeban Sarkar in Bengaluru and Pratima Desai in London; editing by Susan Thomas)