JOHANNESBURG - ANGLO American plc, the globally diversified mining company, maintained its production guidance for this year, except for metallurgical and thermal export coal where it has proposed a demerger of its South African thermal coal assets.
Anglo expects to produce 14 million tons of thermal coal this year, from a previous estimate of 24 million tons, the group said in its production report for the first quarter to the end of March released yesterday.
Export thermal tons from South Africa were expected to decline to 6 million tons between January and May from the previous estimate of 16 million tons for this year.
The demerger, which was subject to shareholder approval next month, was expected on June 4, and the subsequent listing of the demarged business was expected on June 7, Anglo chief executive Mark Cutifani said.
“Anglo American’s portfolio is increasingly tilted towards future-enabling metals and minerals, with our recently proposed demerger of our thermal coal operations in South Africa moving us further in that direction,” Cutifani said.
Earlier this month, Anglo – which produces platinum, nickel, diamonds, copper, iron ore and thermal coal – said it was spinning off its South African thermal coal assets into a standalone company called Thungela Resources.
Thungela, which was expected to have a primary listing on the JSE and a standard listing on the London Stock Exchange, comes as pressure mounts for miners to dump assets that mine fossil fuels. “We are also making good progress in ensuring every operation plays its part towards a lower carbon world, with 100 percent renewable electricity supply now secured for all of our operations across Brazil, Chile and Peru,” Cutifani said.
Anglo said South Africa’s export thermal coal production had fallen by 25 percent to 3.1 million tons. Thermal coal operations continued to operate at 90 percent capacity, due to Covid-19 measures to safeguard the workforce, and were impacted by the second wave of Covid-19 in South Africa, and the Bokgoni pit at Khwezela being placed on care and maintenance.
Colombia’s attributable export thermal coal production decreased by 9 percent to 1.8 million tons owing to a controlled Covid-19-safe ramp-up following a three-month strike that ended in December last year.
The group revised its metallurgical coal production forecast to between 14 million and 16 million tons from the previous 18 to 20 million tons as production at Australia’s Moranbah North Mine remained suspended.
Anglo said that first-quarter group production was at 95 percent of normal capacity, meeting strong customer demand despite some limited constraints at certain operations due to Covid-19.
“Production increased by 3 percent, driven by strong performances at the copper operations in Chile, and platinum group metals (PGMs) and iron ore in South Africa more than offsetting plant maintenance downtime at Minas-Rio iron ore in Brazil and the temporary suspension at the Moranbah metallurgical coal operation in Australia,” Cutifani said.
Production highlights included the 9 percent increase in the Los Bronces and Colluasi copper mines in Chile, the 7 percent increase in PGM on higher throughput at the Mogalakwena mine, and the 10 percent higher output at Kumba Iron Ore. Diamond production fell by 7 percent, driven by operational challenges and excessive rain in southern Africa, said Anglo.
Anglo shares closed 0.33 percent lower at R608.14 on the JSE yesterday.
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