Weatherly International to meet copper production expectations by end of 2016

20th Oct 2016 11:28

(ShareCast News) - AIM-listed copper miner Weatherly International said it would meet production expectations by the end of the year, despite a groundwater problem at its Namibia mine.In an update for the quarter ended 30 September, the company said copper output for the quarter was 14.3% below nameplate, as anticipated, and it expects to re-attain nameplate copper output rates by the end of the December quarter.Last quarter the Tschudi open pit mining operation encountered a problem with groundwater inflow rates exceeding the highest rates indicated in hydrogeological studies, which caused delays in mining the ore volumes resulting reductions in copper output.The company said production rates for the September quarter were expected to be about 15% below nameplate rates and expects to return to rates of 1,417 tonnes per month by the end of 2016.As a result of reduced production, additional costs to deal with the groundwater inflow and adverse exchange rate movements, costs for the quarter increased to $5,073 per tonne.The groundwater management is focused on long-term solutions including de-watering boreholes to be established within and/or outside the pits and the company is "confident in its ability to manage groundwater in the long term".The group also said that if copper prices remain at current levels it is unlikely that it and its subsidiaries would generate a sufficient surplus cash to meet loan repayments as it is currently in talks with Orion Mine Finance Fund on the subject.Chief executive Craig Thomas said: "After recording such a strong performance in the March quarter, we are disappointed that we were unable to anticipate such high groundwater inflow rates at Tschudi, and have consequently spoiled the company's track record of beating our guidance."Our operating team however is fully focussed on meeting or beating the new revised guidance and on demonstrating once again what they, and the Tschudi operation, are capable of."Shares in Weatherly International fell 16.67% to 0.250p at 1038 BST.