MMG fast tracks Australia zinc project to ride on zinc price rally
The miner returns to a US$113.7 million net profit in the first half of 2017, versus a loss last year
MMG, the Hong Kong-listed overseas mining unit of state-owned metals trading giant China Minmetals, says it will start trial production at its Dugald River zinc mine earlier than it planned, after reporting its best interim profit in five years.
The Hong Kong and Melbourne-based firm expects to mine its first tonne of the metal used to galvanise steel to prevent corrosion before year end, compared with the original targeted first half of 2018 as mine construction went ahead of schedule.
“Our capital expenditure will also be at the lower end of our guidance of US$600 million to US$620 million,” chief executive Jerry Jiao Jian told reporters and analysts via teleconference on Wednesday.
Its coming on stream “is perfectly timed to benefit from zinc price surpassing US$3,000 a tonne in recent days,” he added.
The Dugald River zinc mine in Queensland, Australia with targeted annual output of 170,000 tonnes, would partially replace lost output from its much larger Century mine in the same state that was decommissioned late 2015.
Average spot market zinc price in London has jumped 50 per cent year on year to US$2,690 a tonne in the year’s first half.