Copper Mountain Mining Corp. [CMMC-TSX] said Wednesday it has successfully installed and begun commissioning of a third ball mill at its Copper Mountain Mine in southern British Columbia.
The installation of the third ball mill completes the Ball Mill 3 Expansion project and will increase plant milling capacity to 45,000 tonnes per day, up from 40,000 tonnes.
With the third ball mill now having been commissioned, the ongoing throughput expansion to 45,000 tonnes per day remains on track for completion by the end of the third quarter of 2021, the company said.
Copper Mountain shares advanced on the news, rising 7.4% or 21 cents to $3.05 on volume of 880,030. The shares are trading in a 52-week range of $5.07 and 88 cents.
The announcement comes after Copper Mountain recently raised its annual production forecast after reporting better-than-expected financial results in the second quarter of 2020.
The company said it now expects to produce 90-100 million pounds of copper, this year, marking a 6.0% increase from previous forecasts of 85-95 million ounces. All-in-sustaining cost forecasts for 2021 remain unchanged at US$1.80 to US$2.00 a pound.
Copper Mountain’s flagship asset is the 75%-owned Copper Mountain mine near the town of Princeton, British Columbia. The Vancouver-based company is working in a strategic alliance with Mitsubishi Materials Corp., who owns 25% of the mine.
Copper Mountain has previously announced a new integrated life of mine production plan for the Copper Mountain mine. The plan includes a modest expansion of its existing mill to 45,000 tonnes per day and the integration of production from the nearby New Ingerbelle property.
Although strong copper output of 51 million pounds in the first half of 2021 represents 54% of the updated annual production guidance, grades are expected to moderate in the second of the year due to mine sequencing.
Better-than-expected financial results were driven by the strong operating performance of the of the Copper Mountain mine. Estimated adjusted earnings per share in the second quarter was well above analysts’ consensus estimates of $0.16.
Second quarter copper production of 25.5 million pounds was 13% above Scotiabank estimates of 22.6 million pounds. In addition to copper, the mine also produced 7,627 ounces of gold, and 147,973 ounces of silver in the second quarter.
Solid free cash flow generation has improved Copper Mountain’s balance sheet, including cash and restricted cash of $191 million. The company exited the quarter with an improved net debt position of $203 million, down from $231 million in the first quarter of 2021. The improvement was driven by strong free cash flow generation of $46 million.