OZ Minerals Says Gold Output May Miss Guidance on Power Outageby
Power failure in South Australia shuttered mines to steelworks
Supply may be restored to Prominent Hill in seven to 10 days
OZ Minerals Ltd., Australia’s third-largest copper producer, said full-year gold output may miss forecasts following a power outage across South Australia that’s halted production.
A processing plant at the Prominent Hill copper-gold mine remains on standby following a transmission failure on Wednesday that cut off the entire state’s power supply, the Adelaide-based producer said in a statement on Monday. Electricity transmission to the operation is likely to be progressively restored over the next seven to 10 days, it said.
While copper production in 2016 is expected to remain within the forecast range, gold output “will be within or below the lower end of guidance,” OZ Minerals said. In August, the producer forecast full-year copper output of 115,000 to 125,00 metric tons and gold supply of 125,000 to 135,000 ounces.
Production of concentrate will resume once the site has a full power supply, OZ Minerals said in the statement. Open-pit mining is unaffected, while the site’s underground mine has resumed limited operations, it said. In 2015, the company derived about 80 percent of revenue from copper and 19 percent from gold, according to data compiled by Bloomberg.
Power failures and storms in the state have also shuttered BHP Billiton Ltd.’s Olympic Dam copper mine and caused stoppages at Nyrstar NV’s Port Pirie operation, among the world’s biggest lead smelters. Australian steel producer Arrium Ltd. may face costs of as much as A$40 million ($30.6 million) after output was halted, the firm’s administrators said Sunday.
OZ Mineral shares traded 0.2 percent lower at A$6.07 at 10:51 a.m. in Sydney.