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R/€ = 19.80 Change: 0.36
R/$ = 18.15 Change: 0.52
Au 1647.21 $/oz Change: 16.16
Pt 735.52 $/oz Change: -0.90
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First Quantum ‘remains stable’, but cuts executive salaries by 20%

24th March 2020 BY: Simone Liedtke

TSX-listed First Quantum Minerals has said its production and sales “remain stable” in the current environment and the company is maintaining its production guidance for the year.

In a statement on March 24, CEO Philip Pascall said the company’s key priorities are the health of its employees and to “ensure the business remains robust amid a challenging commodity price environment”.


The miner also said that it was “doing everything it can” to care for staff, their families and the communities in relation to the Covid-19 pandemic.

First Quantum would continue to operate its mines responsibly, it said, adding that this would enable it to continue providing employment and generating revenues.


In relation to the virus, however, the miner confirmed that several members of the contractor workforce at the Cobre Panama operation had contracted the coronavirus, which causes Covid-19.

“The affected personnel are being cared for in the public healthcare system as per the Panama Ministry of Health requirements,” the statement said.

Cobre Panama has already implemented the appropriate control, isolation and quarantine measures in line with government guidelines and its site-specific conditions.

On March 20, the Government of Panama by means of Executive Decree 500 clarified that Cobre Panama was specifically authorised to continue operating, albeit with strict adherence to the protocols established by the Ministry of Health which will require a reduced labour force operating on 12-hour shifts.

Similarly, at other mine sites the company was prepared for control, isolation and quarantine as necessary.

Despite the current global crisis, the company has not experienced any significant disruption to sales, supply chains and product shipments since the onset of the Covid-19 pandemic.

Year-to-date operations in Zambia have been slightly better than expected with good grades and recoveries within the mixed and sulphide ores at Kansanshi and improved mining volumes and ore grades at Sentinel.

Following the announcement of heightened restrictions in South Africa, including controls on ports and transit routes, the company noted that it is managing the export of its Zambian production through alternate routes.

Cobre Panama continued to ramp up and expectations for 2020 copper production remained unchanged at between 285 000 t and 310 000 t.

However, owing to the implementation of the health protocols at the operation, the pace of ramp-up may be slightly slower than originally planned and will impact first half production.

At this stage, it is expected that the yearly production expectation can still be met with better than planned second half production levels, and the Punta Rincon international port at Cobre Panama remains open for import and export.

Additionally, the restart of operations at Ravensthorpe has continued with the first shipment expected to be within the first half of the year. And at Las Cruces, in Spain, the focus is on mining out the remaining in-pit ore which is progressing to plan.

All other operations are operating normally, the miner said.

However, in order to reduce its costs, First Quantum is reviewing its capital spending plans, including potentially deferring some capital spending that had been planned for this year.

It would also temporarily reduce the salaries of certain senior staff, including the CEO, by 20%.

“We remain committed to deliver growth in copper production at low costs and to de-lever our balance sheet. 

“These times are unprecedented, they require adaptability and flexibility which are part of the culture we’ve built at First Quantum. We are well positioned to execute our plans through this period of uncertainty and continue to believe in the long-term fundamentals of copper,” commented Pascall.  

EDITED BY: Chanel de Bruyn Creamer Media Senior Deputy Editor Online
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