Mar 28 Juil 2009 07:16
Equinox Minerals' output to lag forecasts-analyst
:cry: Equinox Minerals' output to lag forecasts-analyst
Fri Jun 26, 2009
TORONTO, June 26 (Reuters) - Equinox Minerals (EQN.TO) will likely miss production and cost targets at its Lumwana copper mine in Zambia this year, Macquarie Research said on Friday.
In a note, analyst Pierre Vaillancourt said heavy rains and other factors such as a lack of available trucks would likely keep Equinox from meeting its production goal of 170,000 tonnes of copper in concentrate at a cost of $1.15 a pound for 2009.
"We estimate the downside range to be 130,000-140,000 tonnes at costs of C$1.31/lb," he said.
He said it could be a "challenge" for the company to produce 170,000 tonnes -- the company's long-term target for steady production -- in 2010 as well, although that will depend heavily on the length of next year's rainy season, he said.
Macquarie now expects output of 139,000 tonnes this year and 163,000 tonnes in 2010.
Vaillancourt expects Equinox to achieve steady output of 170,000 tonnes over the next 12 to 24 months and possibly expand from there. He said the mine offers "attractive upside".
Lumwana, which Equinox says is Africa's largest open-pit copper mine, opened in December after a five-month delay caused by a fire at the site's processing plant.
The mine was shut down for about 18 hours last week and lost 500 tonnes of copper production during a national blackout.
Equinox, which is 16 percent owned by Canada's First Quantum Minerals (FM.TO), also mines uranium from Lumwana and plans to build a uranium processing plant when prices recover.
Shares of Equinox, which is based in Australia, but trades in Toronto, were down 10 Canadian cents at C$2.68.