Mineral Resources Limited (ASX: MIN) has released its Quarterly Exploration and Mining Activities Report for the period to 30 June 2022. Highlights:
- Safety performance for the quarter remained strong with no Lost Time Injuries and a Total Reportable Injury Frequency Rate of 2.33, an improvement quarter on quarter (qoq).
- Mining Services production volumes were 64Mt during the quarter, achieving a record 274Mt for FY22, slightly below the guidance range of 275-290Mt.
- Iron ore shipments were 4.7M wet metric tonnes (wmt) during the quarter. FY22 iron ore shipments of 19.2M wmt were at the upper end of FY22 guidance (18.5-19.5M wmt), and 11% higher than FY21. Costs (CFR ex-royalties) will be within FY22 guidance of A$96-104/wmt for Yilgarn and A$80-88/wmt for Utah Point.
- Average realised iron ore price for the quarter was US$85.95 per dry metric tonne (dmt), 15% lower qoq and representing a 62% realisation of the Platts 62% IODEX.
- Mt Marion produced 128k dmt and shipped 141k dmt of spodumene concentrate during the quarter. A total of 442k dmt of spodumene concentrate was shipped during FY22, marginally below guidance of 450-475k dmt. Costs (CFR ex-royalties) will be within FY22 cost guidance of A$570-615/dmt. The average realised spodumene concentrate price for the quarter was US$2,645/dmt, 35% higher qoq.
- MinRes’ maiden share of offtake for Mt Marion spodumene concentrate was converted into 6,722t of lithium hydroxide in China under the tolling agreement with Ganfeng . The structure of this agreement is such that Mt Marion lithium hydroxide EBITDA for FY22 is now expected to be US$150-160 million (unaudited). Revenue for the sale of this product is now expected to be US$510-520 million (unaudited).
- MinRes has exercised an option to extend the Mt Marion tolling agreement with Ganfeng for an additional three months to 30 November 2022, with scope for further extensions.
- The restart of operations at Wodgina has progressed well with first spodumene concentrate from Train 1 delivered as planned in May and 20k dmt of spodumene concentrate produced in the quarter. The restart of Train 2 progressed well with first spodumene concentrate delivered in early July, in line with guidance.
- First product from Train 1 of the Kemerton Lithium Hydroxide Plant owned by the MARBL JV was delivered in early July 2022. Train 2 completion is progressing well with first product sample on track for Q2 FY23.
- During the quarter, MinRes successfully completed a US$1.25 billion Senior Unsecured Notes offering, consisting of US$625 million with 8.000% coupon due 2027 and US$625 million with 8.500% coupon due 2030. MinRes was also added to the S&P/ASX 50 index, effective 20 June.
