Taseko targets 2025 for first copper output at Florence

Taseko Mines (TSX: TKO; NYSE: TGB) expects first production from its fully permitted Florence copper project in Arizona in the fourth quarter of 2025.

The company said it’s moving forward with construction of the commercial production facility, with initial site preparations underway, according to its fourth quarter and full-year results release on Thursday.

Construction of the SX/EW plant and other surface infrastructure will begin in the following quarter, the British Columbia-based copper miner added.

“Taseko is in a very unique position heading into 2024 with a fully permitted, low-cost project that will provide 80% growth to our North American copper production profile in the coming years,” Taseko CEO Stuart McDonald said.

The central Arizona project forms part of the supply needed for the global energy transition’s push to expand copper production by nearly three times current levels by 2040, according to the International Energy Agency.

In November 2023, the US Environmental Protection Agency issued the final permit required to begin construction at Florence, which, when fully operational, will have an annual capacity of 85 million lb. of LME Grade A copper and a mine life of 22 years.

Shortly after, Taseko secured additional fundings totalling US$100 million for the proposed copper mine, supplementing the previous financings from its partner Mitsui as well as Bank of America.

Record revenue

Last year also saw Taseko post its highest ever revenue of US$525 million, much of which was contributed from its Gibraltar mine near McLeese Lake, B.C. The revenue represented a 34% increase compared to 2022.

In 2023, Gibraltar produced a total of 122.6 million lb. of copper, with an average copper recovery rate of 82.6% and head grade of 0.25%. This production was higher than the company’s original guidance and also 26% higher than in 2022.

Approximately 120.7 million lb. of copper were sold at an average realized price of US$3.84 per lb., leading to cash flows from operations of US$151.1 million and net income of US$82.7 million, both significantly higher than the prior year.

The strong financial performance was also a result of Taseko boosting its stake in Gibraltar to 87.5% from 75%, with the acquisition of a 50% interest in Cariboo Copper last March.

“The Gibraltar mine finished a successful year with another strong production quarter. The lower benches of the Gibraltar pit continued to deliver the quality ore we expected, with copper grades averaging 0.27% for the period. This resulted in strong earnings and US$63 million of operating cash flow in the fourth quarter,” McDonald stated.

Looking ahead, the Gibraltar pit will continue to be the main source of mill feed for the first half of 2024 before mining of ore transitions into the Connector pit in the second half. Stripping activity will continue to be focused in the Connector pit, and further oxide ore from this pit is expected to be added to the leach pads this year. Restart of the SX/EW facility at the Gibraltar mine is expected in 2026.

“Factoring in the additional down time in 2024, we expect Gibraltar to produce approximately 115 million lb. of copper for the year, with quarterly production less variable than in recent years,” McDonald said.

After announcing its year-end results, Taseko Mines’ stock jumped 5.9% to a near 52-week high of $2.31 on Friday afternoon. The company has a market capitalization of $670.9 million.