Southern Copper increased production of copper in the third quarter on gains at its Buenavista mine in Mexico.
Southern boosted copper output by 10% to 184,993 mt in the quarter from 168,210 mt a year ago, the Phoenix-based company said Tuesday in a statement. Zinc output rose 22.4% to 16,297 mt, while silver gained 12% to 3.3 million oz and molybdenum slid 4.7% to 5,739 mt.
Southern said it sold copper at $2.40/lb on the Comex, down 24% from a year earlier. Silver prices dropped 24% to $14.87/oz, while zinc fell 20% to 84 cents/lb and molybdenum halved to $5.75/lb.
The company's cash costs net of by-products rose to $1.06/lb through the first three quarters from $1.04/lb a year earlier. Capital expenditures were 23% lower in Q3 at $316 million, with the bulk of spending on the $3.4 billion Buenavista expansion.
The Buenavista expansion is 99% complete and produced its first copper concentrates last month, the company said. Work is 78% complete at the $340 million Quebalix heap leaching project.
The company, which sold $2 billion in bonds in April, has invested $67.7 million on a mine slope stability program and $65.8 million on a $165.5 million conveyor belt at its Cuajone mine in Peru.
Southern, which secured an environmental permit in August for its $1.4 billion Tia Maria copper deposit in Peru, said it is working on community relations and information campaigns to help overcome opposition to the project.
Southern posted a $98.4 million Q3 profit, down 69.7% due to a 23% decline in sales to $1.13 billion and the $100 million acquisition of the El Pilar copper project in Mexico. The company is counting on Tia Maria and expansions at three of its mines to nearly double annual copper production to 1.17 million mt by 2018.
Southern is the largest copper producer in Peru and Mexico.
