Anglo American have announced its full year results for 2009. Group operating profit was US$ 5 billion on revenues of US$ 24.5 billion. Net debt was maintained at US$ 11 billion. This represents at drop of 50% in operating profit on 2008.
Met coal delivered an operating profit of US$ 451 million, down 59% on 2008. The company attributes most of this to lower prices as a result of weaker demand, partially offset by lower mining costs. Production of 12.6 million t was only 4% down on 2008 levels.
Production from the Dawson, Drayton South and Capcoal (Lake Lindsay) expansion projects as expected to continue to increase over the next 2 – 3 years as equipment productivity is raised to benchmark standards. Potential greenfield projects at Grosvenor, Moranbah South and Dartbrook will continue to be studied , with a first stage approval decision for the Grosvenor project expected this year.
Anglo American expects the positive trend seen from the steel industry in both China and the traditional markets at the end of last year to continue into this year, returning steel production levels to 2008 levels and providing positive movement for met coal prices.
Thermal coal faired slightly better that met coal, recording a 33% drop in profit to US$ 721 million. South African operations contributed US$ 442 million with production of 59 million t, while the Cerrejon mine in Colombia contributed US$ 305 million with production of 10.2 million t.
Production began at the 6.6 million tpa Zibulo project in South Africa in Q3 2009 and will continue to ramp up through this year, reaching full production in 2012. The Cerrejon expansion project was also completed in 2009. The mine now produced 32 million tpe, with feasibility studies underway to expand the operation up to 40 million tpa.
Echoing the reports from other big miners, Anglo American expects underlying demand to remain strong on the back of economic growth in Asia, particularly India and China. The steady increase in oil prices and coal winters in Europe and Asia will also drive coal demand. A significant portion of the company’s coal sales for 2010 is exposed to market prices, which are currently standing significantly higher for H2 2010 than those of 2009.
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