ZUG, SWITZERLAND, Aug. 14, 2012 /CNW/ - Katanga Mining Limited (TSX: KAT) ("Katanga" or the "Company") today announces its financial results for the second quarter of 2012. Katanga's Financial Statements and Management's Discussion and Analysis will be filed on SEDAR, www.sedar.com.
Highlights during the three and six months ended June 30, 2012, and Outlook
- During the three months ended June 30, 2012 ("Q2 2012"), the Company mined 1,300,388 tonnes of ore (0.3% higher than the three months ended June 30, 2011 ("Q2 2011")) at a grade of 4.18% resulting in contained copper in ore mined of 54,348 tonnes. During the six months ended June 30, 2012 ("H1 2012"), the Company mined 2,531,461 tonnes of ore (8% higher than the six months ended June 30, 2011 ("H1 2011")) at a grade of 3.88% resulting in contained copper in ore mined of 98,146 tonnes.
- Ore mined and hoisted at KTO Underground Mine for Q2 2012 was a record 456,440 tonnes, and a 10% increase over Q2 2011. The average copper grade for Q2 2012 was 3.71%. For H1 2012, ore mined and hoisted was 872,885 tonnes, a 9% increase over H1 2011. The average copper grade for H1 2012 was 3.65%.
- A record 843,948 tonnes of ore were mined at KOV Open Pit during Q2 2012, 40% above Q2 2011. The copper grade of ore mined from KOV Open Pit for Q2 2012 averaged 4.43%. For H1 2012 1,658,576 tonnes of ore were mined, 44% above H1 2011. The copper grade of ore mined averaged 4.00%. Higher grade ore has become available during the three months ending September 30, 2012, ("Q3 2012") in Cut 1D as mud has been removed from the bottom of KOV Open Pit.
- The Kamoto East Pit is effectively dewatered with 6.6 million cubic metres of water having been removed. The Kamoto East Pit dewatering allows for more efficient and cost effective waste management and the potential development of the Kamoto East mineral resource using underground mining methods.
- Ore milled at the Kamoto Concentrator ("KTC") for Q2 2012 was 1,232,440 tonnes, an increase of 14% from Q2 2011 and a production record. For H1 2012, 2,236,717 tonnes were milled, an increase of 13%.
- Copper produced in metal and concentrate for Q2 2012 totalled 24,313 tonnes, with copper metal produced increasing by 2% compared to Q2 2011. For H1 2012, 43,062 tonnes were produced, with copper metal produced increasing by 12%.
- Cobalt produced totalled 477 tonnes for Q2 2012. In H1 2012, 1,071 tonnes were produced.
- Copper and cobalt production continued to be adversely affected by recurrent general power disruptions in the DRC. During Q2 2012, lost production hours across the operation amounted to approximately 387 hours due to power disruptions. This amounts to approximately 17 days of lost production and includes the time from the power disruption until equipment is operating at pre power disruption capacity. The lost production hours across the operation for H1 2012 amounted to approximately 671 hours or 28 days which equates to a month of lost production time. The lost production time excludes the adverse impact on equipment availability due to the unplanned shut downs and subsequent start ups of the equipment due to the power disruptions. The Company expects power disruptions to decrease during the second half of 2012 due to a new convertor that is expected to be commissioned by the end of August 2012 as part of the World Bank power project and a new synchronous condenser that is expected to be commissioned at the end of Q3 2012 as part of Katanga's agreements with Société Nationale d'Électricité ("SNEL"), the DRC's national electricity company, and engineering contractors to refurbish DRC power generating, transmission and distribution systems (the "Power Project") (as previously announced on March 29, 2012). In the medium to long term, improvements in infrastructure as a result of the Power Project are expected to improve the reliability and stability of electricity supplies generally.
- Total sales for Q2 2012, were $102.5 million and for H1 2012 were $237.2 million.
- The sales value of oxide concentrate available to be shipped but not invoiced as at June 30, 2012, amounted to approximately $62.6 million and the sales value of copper nodules available to be shipped as at June 30, 2012, amounted to approximately $78.3 million.
- For Q2 2012, the Company generated a net loss attributable to shareholders of $0.9 million and for H1 2012, the Company generated a net income of $16.7 million.
- Cash and cash equivalents as at June 30, 2012, amounted to $38.1 million.
- The Company expects the first copper cathode production through the new Solvent Extraction "SX" plants and converted copper electro-winning facility during Q3 2012. Mechanical completion of the Updated Phase 4 Expansion is expected in the third quarter of 2013.
- The Company expects to commence exporting copper nodules during Q3 2012.
- The feasibility study for the potential T17 underground mine is expected to be completed during Q3 2012. This will potentially allow for the exploitation of additional T17 mineral resources below the bottom of the current open pit through underground mining techniques.
About Katanga Mining Limited
Katanga Mining Limited operates a major mine complex in the Democratic Republic of Congo producing refined copper and cobalt. The Company has the potential to become Africa's largest copper producer and the world's largest cobalt producer. Katanga is listed on the Toronto Stock Exchange under the symbol KAT.
Forward Looking Statements
This press release may contain forward-looking statements, including, but not limited to, the value of oxide concentrate available to be shipped but not invoiced, the sales value of copper nodules available to be shipped, the increase in copper and cobalt production levels, the first copper cathode production through the new SX plants, the mechanical completion of the Updated Phase IV expansion, the commencement of the export of copper nodules, the anticipated decrease in power disruption relating to the upgrade in power infrastructure and the completion of the feasibility study for the potential T17 underground mine. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.
Forward-looking statements involve known and unknown risks, future events, conditions, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, prediction, projection, forecast, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, the actual results of current exploration activities; actual results and interpretation of current reclamation activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of copper and cobalt; possible variations in ore grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of exploration, development or construction activities, as well as those factors disclosed in the Company's current annual information form and other publicly filed documents. Although Katanga has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise, except in accordance with applicable securities laws.
Tim Henderson, Technical Consultant, Katanga and a "qualified person" as such term is defined in NI 43-101 has reviewed and approved the scientific and technical disclosure in this press release.
SOURCE Katanga Mining Limited