SA News • Yesterday, 10:58 AM
First Quantum Is Headed For First Place In Copper Production
- By 2018, First Quantum will move into fourth place amongst the world's copper miners, and may challenge for first place before the end of this decade.
- Shares have recently dropped about 15% after second quarter results narrowly missing expectations due mostly one time costs.
- The recent price drop presents an opportunity for a long-term investment in a well managed and growing company.
- First Quantum continues to increase its long-term copper production potential, while also adding valuable nickel assets.
- With the acquisition of Lumina, First Quantum likely won't be self-funding until 2018.
- First Quantum remains on target and on plan, but is trading more or less around fair value today.
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Yesterday, 10:58 AM
- First Quantum Minerals (OTCPK:FQVLF -8.5%) says it has substantially reduced planned capital spending in 2015 for its Cobre Panama copper project to $600M, while projecting total capital spending for the year of $1.2B-$1.4B.
- Says Q4 copper production fell 8.3% Y/Y to 105.1K metric tons while copper sales fell less than 1% to 94.8K metric tons; gold output fell 9% to 57.5K oz.
- For 2015, the company expects copper output of 410K-440K metric tons and gold production of 218K-247K oz.
Wed, Jan. 14, 12:49 PM
- As TD Securities analysts test free cash flow for Canadian copper producers at US$2.50/lb. for copper, every company in their coverage area except Copper Mountain Mining (OTCPK:CPPMF -13.5%) is found to have negative free cash flow.
- First Quantum Minerals (OTCPK:FQVLF -11.4%) might have the biggest problem, the TD analysts say, calculating that its free cash flow is negative US$1.2B at $2.50 copper due to a royalty hike in Zambia and major spending commitments at the Cobre Panama project.
- The favorite names in a low price environment are Lundin Mining (OTCPK:LUNMF -12.7%), HudBay Minerals (HBM -13.7%) and Nevsun Resources (NSU -4.7%), thanks to their solid balance sheets and low capital spending requirements in 2015.
Dec. 23, 2014, 12:58 PM
- The new tax laws in Zambia could turn out to be a positive for First Quantum Minerals (OTCPK:FQVLF) even as high-cost producers such as Barrick Gold (NYSE:ABX) begin to close operations, CIBC analyst Tom Meyer says.
- Zambia's budget, which included a revision to the mining tax scheme that would require open pit miners to pay a 20% mineral royalty tax, was passed on Dec. 17 and First Quantum’s stock has come under pressure since ~40% of the company’s operating base is located in the country.
- "As a low cost producer in Zambia, First Quantum could be a net beneficiary of the new system,” Meyer says, adding that a comparison of effective tax rates under the two systems "shows that the new system is increasingly favorable for the miners when the copper price is rising.”
Dec. 15, 2014, 3:11 PM
- First Quantum Minerals' (OTCPK:FQVLF) Ravensthorpe nickel mine in Australia has been temporarily shut after a processing plant rupture late Sunday resulted in a chemical spill.
- The company says a structural failure occurred in the atmospheric leach tank at the 38K metric tons/year mine, adding that the spill was contained and no adverse environmental effects are expected.
- First Quantum does not yet know if a declaration of force majeure would be invoked protecting the company from interruptions to sales obligations.
Oct. 13, 2014, 10:37 AM
- Zambia plans to more than triple royalties on open-pit mines, underscoring a growing trend across Africa where governments are changing tax regimes and adjusting ownership structures to get a bigger share of natural resources.
- The finance ministry says in a budget report that starting in Jan. 2015 royalties will increase to 20% from 6% for open-pit copper mines and to 8% from 6% for underground mines.
- Mining companies with open-pit mines in Zambia include Barrick Gold (NYSE:ABX) and First Quantum Minerals (OTCPK:FQVLF), while Glencore (OTCPK:GLCNF, OTCPK:GLNCY) and Vedanta Resources (OTCPK:VDNRF) operate underground mines.
- Zambia has withheld $600M of tax refunds from miners since last year, already straining the relationship between the government and mining companies.
Oct. 1, 2014, 9:43 AM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) says it has suspended some of its planned $800M in copper projects in Zambia after the government withheld at least $200M in tax refunds.
- The dispute is a major setback for Glencore, which has invested more than $2B in projects in Zambia and is in the process of upgrading its copper assets in the country to boost output by at least 50% over the next two to three years.
- First Quantum Minerals (OTCPK:FQVLF), whose Kansanshi mine is Zambia's largest copper mine by output, made a similar move in July to freeze its $1.5B in investments in the country over withheld tax refunds.
Aug. 26, 2014, 10:21 AM
- Zambia's government says it plans to relax tax rules on copper exports, good news for the country's copper miners that have been seeking more than $600M in unpaid tax refunds
- The government had said earlier it would pay the refunds only if the companies produced import certificates, but mining executives argued that producing the import certificates is next to impossible because companies sometimes sell their minerals to middlemen.
- Companies such as Glencore (OTCPK:GLCNF, OTCPK:GLNCY), Vale (NYSE:VALE), First Quantum Minerals (OTCPK:FQVLF) and Vedanta Resources (OTCPK:VDNRF) invested ~$6B in Zambia during the global commodities boom, which peaked in 2011.
Jul. 30, 2014, 7:08 PM
Jun. 27, 2014, 10:11 AM
- First Quantum Minerals (FQVLF) says it has suspended work at its $6.4B Cobre Panama copper project because of a labor dispute with some of its construction workers.
- Opposition to a new work schedule sought by First Quantum's Minera Panama subsidiary during the project’s construction phase sparked the conflict, which has included blocking area highways.
- The project aims to produce ~320K metric tons of copper, 100K oz. of gold and 1.8M oz. of silver per year.
Jun. 17, 2014, 12:34 PM
- First Quantum Minerals (FQVLF -0.2%) agrees to acquire Lumina Copper (LCPRF +19.6%) for $470M in a cash and stock deal that values Lumina at $10/share, a 28% premium above Lumina's Monday closing price.
- The dea; gives First Quantum the Taca Taca project in Argentina, one of the world’s most promising undeveloped copper deposits with more than 28B lbs. of copper resources and another major project in Latin America to go with Cobre Panama and Haquira.
Jan. 28, 2014, 7:52 AM
- First Quantum Minerals (FQVLF) says it expects to incur $6.4B in development costs for its Cobre Panama copper project in Central America, unveiling its revised capital cost estimate for its key project after a month's delay.
- The figure is ~3% higher than estimates released before First Quantum took over the project last year.
- Production is now pegged at ~320K metric tons/year of copper, up ~20% from original plans, and completion is now seen in H2 2017 instead of H1 2016.
Dec. 10, 2013, 12:42 PM
- First Quantum Minerals (FQVLF -2.5%) says it will delay the release of a full update on its Cobre Panama copper project to Q1 2014, saying it needs to "correct a number of acquired technical and logistical shortcomings" in the project development plan.
- Before being taken over by First Quantum earlier this year, Inmet had pegged the capital cost of developing the project at $6.2B; in its bid for Inmet, First Quantum had cited its project development expertise as a rationale for the combination.
Oct. 30, 2013, 12:13 PM| Comment!
Jul. 10, 2013, 10:25 AMGoldman Sachs favors only single-stock opportunities among miners focused on funded growth and strong free cash flows, such as First Quantum (FQVLF.PK) and Vedanta (VDNRF.PK), as it sees no catalyst for a sector-wide turnaround. Global majors Rio Tinto (RIO) and Anglo American are rated Sell, based on negative earnings momentum and dependency of their free cash flow on iron ore prices. | Comment!
Mar. 22, 2013, 10:33 AMFirst Quantum Minerals (FQVLF.PK) says 85.5% of Inmet Mining’s (IEMMF.PK) shares have been tendered to its hostile takeover bid, putting it on the verge of completing the deal to create a "new global leader in copper." First Quantum says its first priority is to integrate the operations, then begin a detailed review of Inmet’s $6.2B Cobre Panama project to find significant cost savings. | 1 Comment
Mar. 12, 2013, 9:29 AMFirst Quantum (FQVLF.PK) says 61.45% of Inmet Mining’s (IEMMF.PK) shares have been tendered to its hostile $5.1B bid, just shy of the two-thirds majority of shares First Quantum needs to complete the takeover. The company extends its offer to March 21 to pass the two-thirds threshold, and reduces the minimum tender condition to 50%. | Comment!
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First Quantum Minerals Ltd. is a growing mining and metals company engaged in mineral exploration, development and mining. The Company produces LME grade "A" copper cathode, copper in concentrate, gold and sulphuric acid.
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