OZ Minerals Slides After Cutting Copper Forecast: Sydney Mover

Prominent Hill Mine
An earth mover travels down into an open pit mine to pick up a load of mineral deposits at the OZ Minerals Ltd. Prominent Hill mine in South Australia. Photographer: Carla Gottgens/Bloomberg

Oct. 14 (Bloomberg) -- OZ Minerals Ltd., Australia’s third-largest copper producer, fell the most in almost six months in Sydney trading as it cut its output forecast by as much as 20 percent and raised its production cost estimate.

The Melbourne-based company dropped 9.3 percent to A$3.99 at the close in Sydney, the most since April 22, taking its decline for the year to 40 percent. Australia’s benchmark S&P/ASX 200 Index fell 0.4 percent.

Copper production will be 70,000 metric tons to 75,000 metric tons in 2013, lower than an April forecast of 82,000 metric tons to 88,000 metric tons, the company said today in a statement. Cash costs will be $1.90 a pound to $2.05 a pound, compared with the earlier forecast of $1.65 a pound to $1.80 a pound.

The cut is the second this year, after OZ Minerals in April revised down an earlier forecast of 90,000 tons to 95,000 tons. The drop reflects lower-than-expected ore recovery at the eastern end of the Prominent Hill mine in South Australia, the company said.

OZ Minerals, which wrote down the value of Prominent Hill by A$231.9 million ($219 million) in the first half, said copper production was 17,390 metric tons in the three months to September 30, from 25,738 metric tons in the same period a year earlier.

To contact the reporter on this story: David Stringer in Melbourne at dstringer3@bloomberg.net

To contact the editor responsible for this story: Andrew Hobbs at ahobbs4@bloomberg.net