Kumba Iron Ore Limited production and sales report for the quarter ended 31 March 2016
21 April, 2016
Kumba Iron Ore Limited (“Kumba”) today released its production and sales report for the quarter ended 31 March 2016. Throughout this report, production and sales volumes referred to are 100% of Sishen Iron Ore Company Proprietary Limited (“SIOC”), and attributable to shareholders of Kumba as well as the non-controlling interests in SIOC.
Overview:
- Total production from Kumba decreased to 8.9 Mt as Sishen transitioned to a lower cost pit configuration. This is 27% less than Q1 2015 and 18% lower compared to Q4 2015.
- Total export sales volumes decreased by 18% compared to Q1 2015 and by 11% compared to the previous quarter at 9.4 Mt.
| ‘000 tonnes | Quarter | % change | Quarter | % change | |
|---|---|---|---|---|---|
| Q1 2016 | Q1 2015 | Q1 2016 vs Q1 2015 |
Q4 2015 | Q1 2016 vs Q4 2015 |
|
| Total | 8,925 | 12,167 | (27) | 10,935 | (18) |
| - Sishen mine | 5,842 | 8,885 | (34) | 7,661 | (24) |
| DMS plant | 3,550 | 5,758 | (38) | 5,124 | (31) |
| Jig plant | 2,292 | 3,127 | (27) | 2,537 | (10) |
| - Kolomela mine | 2,713 | 2,973 | (9) | 2,854 | (5) |
| - Thabazimbi mine | 370 | 309 | 19 | 420 | (12) |
| ‘000 tonnes | Quarter | % change | Quarter | % change | |
|---|---|---|---|---|---|
| Q1 2016 | Q1 2015 | Q1 2016 vs Q1 2015 |
Q4 2015 | Q1 2016 vs Q4 2015 |
|
| Total | 10,544 | 12,906 | (18) | 11,043 | (5) |
| - Export sales | 9,376 | 11,472 | (18) | 10,509 | (11) |
| - Domestic sales | 1,168 | 1,434 | (19) | 534 | 119 |
| Sishen mine | 717 | 1,114 | (36) | 280 | 156 |
| Thabazimbi mine | 451 | 320 | 41 | 254 | 78 |
Sishen mine produced 5.8 Mt, a decrease of 34% compared to Q1 2015 and 24% lower than Q4 2015. Waste removal was lower at 33.9 Mt versus 49.3 Mt in Q1 2015. The reduction in production and waste volumes was in line with the mine’s lower cost pit configuration.
Sishen continues to experience feedstock constraints which have been exacerbated by higher levels of rainfall experienced during the quarter. Solutions are being implemented to increase mine flexibility. Guidance for the full year remains unchanged at ~27 Mt of production. As previously indicated, detailed work to refine the Sishen life of mine plan based on the revised pit configuration is ongoing and will be finalised during 2016.
The Section 189 process is on track with consultations on the organisational structures completed. The material changes, due to the revised pit configuration and related restructuring require significant management focus to ensure that productivity continues to improve and safety is maintained.
Kolomela produced 2.7 Mt for the quarter, a decrease of 9% on Q1 2015 and 5% on Q4 2015, due to a section 54 stoppage as a result of a fatality that occurred on-mine in January 2016. Run rates have improved subsequently and the mine remains on track to produce 12 Mt.
Export sales of 9.4 Mt decreased by 18% relative to Q1 2015 and 11% to Q4 2015, due to lower production. Total finished product stocks were 3.2 Mt, compared to 4.7 Mt at the end of 2015 as stocks were drawn-down to more optimal levels. Export sales guidance remains at ~40 Mt for 2016.
Domestic sales volumes decreased by 19% relative to Q1 2015 and doubled compared to Q4 2015 to 1.2 Mt, based on customer requirements.
At Thabazimbi, mining activities ceased on 30 September 2015 and processing activities ceased on 31 March 2016. Closure of the mine is proceeding according to plan.