Second-quarter production was lower than expected for Vancouverbased copper miner Quadra Mining (QUA-T, QADMF-O), and the company’s shares fell as a result.
Production from Quadra’s Robinson and Carlota mines missed its own forecast and as a result, guidance for 2009 had to be revised downwards.
“Both of our operations have encountered some challenges this past quarter and while disappointing, they are not altogether atypical,” Paul Blythe, Quadra’s president and chief executive said in a statement.
Total production for the quarter came in at 29.7 million lbs. copper and 18,030 oz. gold, and Quadra says production for the year will be down by roughly 7%.
The bulk of second-quarter production came from the Robinson mine in Ely, Nev.
Robinson produced 22.9 million lbs. copper and 18,030 oz. gold. Those numbers were off the company’s expectations due to concerns over the stability of a pit wall.
Those concerns were raised by the Mine Safety and Health Administration (MSHA), the federal enforcement agency responsible for safety and health in U. S. mines, and as a result Quadra couldn’t access the hypogene ore it uses to blend with supergene ore from the other pit. The combination of the two types of ores has given the company more consistent production and improved metallurgical performance in the past.
Quadra says it has agreed to make changes to the pit design and improve monitoring and fence protection.
It says mining at the hypogene pit will start up again in the third quarter but production guidance for copper has been reduced slightly with the mine now expected to produce about 130 million lbs. copper. Gold production guidance, however, remains unchanged at 100,000 oz. for the year.
Over at its Carlota mine in Globe- Miami, Ariz., production came in at 6.8 million lbs. copper for the quarter — again missing Quadra’s own targets.
Another pit wall issue was to blame. Additional work was required on a pit wall above the Pinto Creek Diversion and that delayed access to higher-grade ore. Quadra expects to have access to the higher-grade ore in the third and fourth quarters.
In addition, leaching rates were also lower than planned as irrigation rates were 20% lower than anticipated due to the segregation of fines during the stacking procedures.
The situation means a shortfall of 1 million tonnes of higher-grade ore for the leach pad.
Quadra says it has revised ore stacking procedures and is adding equipment to try and improve flow rates through the upper leach pad surface.
“Percolation challenges due to the segregation of fines are not unusual and can be resolved by developing different stacking procedures. The lower solution flow rates will increase leach times proportionally. On the positive side, evaluation work to date on material that has been leached continues to confirm that the recoveries used in the feasibility study are appropriate and should be achieved,” Blythe said.
At the company’s third copper project, Franke in Chile’s Region II, the news was somewhat better, although not unmarred by difficulties.
Production at the mine was delayed by pond construction issues and a structural design issue with the primary crusher feed system. But Quadra reports that mining has begun and the first cathode production is expected by the third quarter.
Be the first to comment on "Lower Production Hurts Quadra"