Anglo American records $9.8 billion EBITDA in 2020
Anglo American's underlying EBITDA came in at $9.8 billion in 2020, marginally down on the $10 billion recorded in 2019.
The continued strong performance of Minas-Rio iron ore operation in Brazil and Collahuasi copper joint venture in Chile helped mitigate COVID-19's impact, along with a strong second half production recovery, and the EBITDA disclosed in Kumba Iron Ore's results amounted to $2.8 billion. First copper production from Quellaveco is earmarked next year.
Anglo American's margins rose to 43% in 2020 despite a lower commodity price basket, supported by solid cost control, and it is targeting up to 50%. It recorded a 17% return on capital employed, although net debt finished the year at $5.6 billion, and the net dividend is 72 cents a share.
Technology is playing a key role in driving Anglo American's sustainability performance as it enables more precise targeting of metals and incurs less energy and waste. It is the essence of its FutureSmart Mining programme.
Its Unki platinum mine in Zimbabwe has been assessed against the Initiative for Responsible Mining Assurance’s (IRMA) comprehensive mining standard, achieving the IRMA 75 level of performance.
Finance Director Stephen Pearce said: "We can all agree it's been an eventful year but Anglo American is well placed for the longer term."
Chief Executive Mark Cutifani said safety remains its most pressing challenge, reflecting on the loss of two staff members in South Africa among its 95,000-strong team. "We can never say we've had a good year unless we have had zero fatal incidents," he said.
Copper, PGMs and crop nutrients are all sectors targeted for future growth, as Anglo American targets carbon neutrality by 2040. Q4 Production highlights are listed below.
Vale invests $150mn to extend life of Manitoba operations
Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.
Global energy transition is boosting the market for nickel
The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.
“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.
“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”
Vale continues drilling program at Manitoba
Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.
“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.
“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”
The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history. Mining of the Thompson orebody began in 1961.
“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.