Anvil profits in the DRCRebecca KeenanWednesday, September 01,...

Anvil profits in the DRC

Rebecca Keenan


Wednesday, September 01, 2004
ANVIL Mining has posted improved net earnings of US$6 million on the back of strong metal prices and full production from its Dikulushi project in the Democratic Republic of Congo, where it is now preparing to ramp up output by 50% with the commissioning of the stage II expansion.

Last year the company reported a loss of US$800,000 and said this year's increased earnings reflected a full 12 months of production from the Dikulushi mine as compared to eight months in the previous year.

The mine produced 13,587 tonnes of copper and 1.2 million ounces of silver compared to 8105t copper and 589,000oz silver in the previous year. The realised copper price rose to US97c per pound from US70c/lb in 2003 and silver also increased to US$5.39 per ounce up from US$4.46/oz.

The cash cost per pound of payable copper after silver credits was US21c per pound. Transport costs increased with higher volumes of concentrate delivered to smelters in Namibia and South Africa.

Cash costs rose significantly in the June quarter after the company experienced problems related to its mining contractor being placed in receivership. Anvil took over the mining contract in early June.

The company has forecast production of 20,000t copper per annum from the mine following the commissioning of the expansion, along with 1.8Mozpa silver.

The stage II expansion, which was delayed six weeks following logistic issues, involved the addition of ball mills and a flotation circuit and commenced at the end of last month. The expansion will increase plant recoveries to 92% from 71% and increase concentrate grades to over 55% copper and 1700 grams per tonne silver up from 40% copper and 1000gpt silver.

The better concentrate grades will translate to lower transportation charges and smelting charges per pound of copper produced.

The company said recent exploration could add a further two years to the potential mine life of the underground mine.

Anvil shares on the ASX gained 4.5% to 46c in midday trading".