Anglo American: metallurgical coal up, thermal coal down

30 October 2017

Anglo American has reported its coal production for the third quarter ended 30 September 2017.

Australia

Anglo’s export metallurgical coal production increased by 9% to 5.5 million t as a result of the continued ramp-up at Grosvenor and a 3Q16 longwall move at Grasstree (which began in September 2016). Thermal coal production decreased by 51% following the cessation of mining at Drayton.

Grosvenor delivered strong production in the quarter through successful management of the challenging geological issues associated with a first longwall panel, which is now complete. Mining of the second longwall panel is scheduled to begin in December 2017.

Anglo reported that the run-of-mine stock build as a result of the rail outages following Cyclone Debbie in 1H17 continues to be worked down, with year-end stock expected to be back to normalised levels.

South Africa

Primary export thermal coal production decreased by 16% to 3.8 million t. Following a tragic fatality at Goedehoop on 3 August, all of Anglo American’s South African coal operations were put on a 100-hour safety stoppage for a detailed engagement with all employees and contractors. This commitment to safety resulted in 0.4 million t of production foregone. Primary export production was also impacted by ongoing operational challenges at Khwezela’s export pit and by Mafube transitioning to a new pit.

Eskom related production decreased by 15% to 6.8 million t due to the end of the mine life of the Eskom dedicated pit at Khwezela (0.6 million t), a longwall move at New Denmark and pit reserve constraints at Kriel as it approaches the end of the life of mine.

Cerrejón

Cerrejón’s attributable production decreased by 15% to 2.5 million t due to weather related stoppages.

Full year guidance

The mining giant’s full year production guidance for export metallurgical coal remains unchanged at 19 – 21 million t.

Full year production guidance for export thermal coal from South Africa and Cerrejón remains unchanged at 29 – 31 million t, and is expected to be at the lower end of this range primarily due to the operational challenges at Khwezela.

Commenting on the company’s full production, Mark Cutifani, Anglo American Chief Executive, said: “We have delivered another strong production performance across our business. Grosvenor production has materially stepped-up as the new operating procedures have been implemented, while Gahcho Kué and Minas-Rio continue to make positive contributions. We have further increased production guidance at Kumba Iron Ore as we continue to improve our broader productivity performance. In Platinum, we have taken necessary steps to remove unprofitable ounces from production as we focus on value over volume.”

Source: World Coal