After completing the acquisition of the Las Bambas project in Peru in August, MMG announced that the first phase of integration has been completed following the change in ownership. “Las Bambas is a world-class project and our initial focus has been to address some of the high-priority areas ensuring we have the right structures and controls in place to address risks and ultimately deliver the project on schedule and within budget,” said Andrew Michelmore, CEO, MMG. “As identified during the due diligence process, there were a number of areas that were likely to impact the previous project schedule and capital expenditure guidance.”
MMG originally identified delays relating to the community resettlement, low productivity of engineering, procurement and construction management (EPCM) contractors, and some changes to project scope have impacted the project schedule leading to an increase in capital expenditure. “We have now completed our own review and as a result, MMG expects first production of concentrate in the first quarter of 2016, with the capital expenditure required to complete the Las Bambas project to be in the range of $2.7–3.2 billion,” Michelmore said.
Major activity during the third quarter of 2014 focused on the construction of the processing plant, primary crusher, overland conveyor, and key surface infrastructure including tailings facilities, power lines, mine access and mine maintenance facilities. As at September 30, the overall project was 75% complete.
“Nothing has come as a significant surprise to us and we are looking at opportunities to optimize the project while maintaining a realistic outlook,” Michelmore said. “This is a world-class asset that will become one of the top three copper mines in the world. Our focus is on successful completion of construction and bringing the asset into production.”
MMG has initiated an extensive drilling program at Las Bambas to further define the reserves and resources both within and outside the existing planned pit outlines.