Antofagasta cuts copper guidance after water issues dampen Q1

LONDON (ShareCast) - Chile-focused copper miner Antofagasta (Other OTC: ANFGF - news) has scaled back its production guidance for 2015 after first-quarter output was affected by numerous water issues at its Los Pelambres and Centinela projects. The company said it expects to mine 15,000 tonnes less than its original forecast of 710,000 tonnes.

Production of copper in the first three months of 2015 totalled 146,400 tonnes, down 13.6% on the same period last year and a 21.9% drop from the preceding quarter.

The weaker result was mainly due to disruptions at Los Pelambras where locals protested against the shortage of water in the region and blocked access to the mine.

While normal operations have resumed after an agreement was made with the community, Antofagasta's Centinela project in the north of Chile was also affected by unprecedented heavy rainfall towards the end of the period.

Chief executive Diego Hernández said: "Although we expect to recover some of the lost production resulting from these disruptions, production for the year will be some 15,000 tonnes of copper lower than we originally forecast. However, we still expect our net cash costs for the year to be around $1.40/lb." Gold production for the quarter was down 30.3% on the fourth quarter at 57,400 ounces while molybdenum output was 12.5% lower at 2,100 tonnes.