Eskom’s slowing demand hits Anglo American coal production

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eskom plant (2)Anglo American plc said the performance of coal in the period ending December 2014 was mixed with production destined for Eskom declined on the back of sluggish demand. However, it revealed that the domestic non-Eskom production increased by 43% to 1.8 million tonnes as a result of productivity improvements at Isibonelo.

“Production for Eskom was 2% lower at 7.4 million tonnes owing to reduced Eskom demand and planned production declines at Kriel prior to the move to the new mining areas, offset by stabilised production from New Denmark,” stated in the production report.

The South Africa’s mining focused group said on the other and export thermal coal production increased by 4% to 4.8 million tonnes, driven by productivity improvements across all operations and export product quality optimisation.

For the Australia and Canada, the export metallurgical coal production increased by 4% to 4.9 million tonnes, due to a step change in performance at Grasstree following the Operating Model implementation and Q4 2013 longwall moves. Performance at Moranbah continues to be affected by longwall mechanical issues, which are not expected to be fully rectified until late Q3 2015.

It said the Australian export thermal coal production increased by 18% to 1.9 million tonnes due to improved productivity and mix at Dawson.

At Colombia’s Cerrejón, production decreased by 9% to 3.0 million tonnes, due to the ramp up in Q4 2013 to mitigate the volumes lost in the strike in Q1 2013. Production increased by 27% compared to Q3 2014 aided by favorable weather and a strong operational performance over the prior quarter.

Other metals

Copper – Copper production on a contained metal basis decreased by 18% to 174,800 tonnes.

Nickel – Nickel production decreased by 34% to 6,700 tonnes, principally due to a planned reduction at Barro Alto (down 42% to 4,500 tonnes), reflecting the Line 2 furnace rebuild, which commenced on schedule in October. Completion of the Line 2 rebuild and commencement of the Line 1 rebuild is expected in Q2 2015.

Production from Codemin decreased by 8% to 2,200 tonnes, driven by lower grades.

Niobium – Production of niobium increased by 8% to 1,300 tonnes due to first production in the quarter from the now complete Boa Vista Fresh Rock project.

Phosphates – Concentrate production increased by 1% to 355,600 tonnes due to better throughput from the new milling plant implemented in Q1 2014. Fertiliser production decreased by 5% to 284,900 tonnes due to acid plant maintenance activities in Q4 2014.

Platinum – Equivalent refined platinum production increased by 14% to 593,900 ounces. Mines affected by the strikes in 2014 were fully ramped-up by the end of Q3 and performed ahead of Q4 2013 which was impacted by a two week strike where approximately 44,000 ounces of platinum production were lost.

De Beers – Diamond production decreased by 8% to 8.4 million carats.

Kumba Iron Ore – Production from Kumba Iron Ore increased by 10% to 12.4 million tonnes.

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