MMC Norilsk Nickel (MNOD)
NORNICKEL ANNOUNCES PRELIMINARY CONSOLIDATED PRODUCTION RESULTS FOR FY2019
AND REITERATES PRODUCTION OUTLOOK FOR 2020
31-Jan-2020 / 13:00 MSK
Dissemination of a Regulatory Announcement that contains inside information
according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
PRESS RELEASE
31 January 2020
Public Joint Stock Company "Mining and Metallurgical Company "NORILSK
NICKEL" (PJSC "MMC "Norilsk Nickel", "Nornickel" or the "Company")
NORNICKEL ANNOUNCES PRELIMINARY CONSOLIDATED PRODUCTION RESULTS FOR FY2019
AND REITERATES PRODUCTION OUTLOOK FOR 2020
Moscow - PJSC MMC Norilsk Nickel the world's largest of palladium and
high-grade nickel and a major producer of platinum and copper, announces
preliminary consolidated production results for the fourth quarter and the
full year of 2019 and reiterates its production outlook for the full year
2020.
First Vice-President, Chief Operating Officer, Sergey Dyachenko commented on
the production results:
«In 2019, the Company increased the output of all key metals as a result of
improved operating efficiency, optimization of production flow and ongoing
ramp-up of Bystrinsky project.
Total nickel output increased 5% year-on-year to 229 kt owing to the ramp-up
of the refining shop operating new chlorine leaching technology and
expansion of carbonyl nickel production capacity at Kola MMC. Total copper
output increased 5% year-on-year to a record of 499 kt driven by improved
operating efficiency, increased mined ore volumes and higher copper grades
at Talnakh mines as well as the ramp-up of Bystrinsky (Chita) project that
was fully commissioned in September 2019. Palladium and platinum output
increased 7% and 8% year-on-year to 2.9 moz and 0.7 moz, respectively, owing
primarily to the release of work-in-progress inventory.
We reiterate our production guidance from own Russian feed for FY2020
announced at the Capital Markets Day in November 2019 [1]».
NORILSK NICKEL GROUP
Nickel
In 4Q19, consolidated nickel production increased 8% quarter-on-quarter
(q-o-q) to 62 kt, almost all of which was produced from own Russian feed.
The growth was attributed to increase in production of nickel concentrate
for sale to third parties and expansion of carbonyl nickel production
capacity at Kola MMC.
In 2019, consolidated nickel production increased 5% year-on-year (y-o-y) to
229 kt. The growth was attributed to gradual ramp-up of nickel refinery
operating new chlorine-leaching technology, the expansion of carbonyl nickel
production as well as the launch of low-grade nickel concentrate production
for the sale to third parties at Kola MMC and more third party feed
processed at Norilsk Nickel Harjavalta.
Nickel output from the Company's own Russian feed amounted to 225 kt in line
with the top end of the 220-225 kt production guidance for 2019.
Copper
In 4Q19, consolidated copper production increased 5% q-o-q to 127 kt, almost
all of which was produced from own Russian feed. The growth owed to higher
copper grades in mined ore at Polar Division and the ramp-up of Bystrinsky
(Chita) project.
In 2019, consolidated copper production increased 5% y-o-y to a record of
499 kt. The growth was driven by the ramp up of Bystrinsky (Chita) Project,
increased mined ore volumes and higher copper grades at Talnakh mines as
well as increased copper concentrate and copper cathodes production at Kola
MMC from the matte received from Polar Division.
Copper output from the Company's own Russian feed (excluding Bystrinsky
project) amounted to 455 kt, slightly above the 430-450 kt production
guidance range for 2019. Copper output at Bystrinsky GOK amounted to 43 kt,
which was in line with the 40-46 kt production guidance for the asset.
Platinum Group Metals
In 4Q19, palladium and output amounted to 669 koz (-7% q-o-q) and 149 koz
(-9% q-o-q), respectively. The decrease of PGMs output was scheduled and
attributed to the commissioning of the new precious metals concentrate
production line at the metallurgical shop at Kola MMC and trial shipments of
copper cake (containing precious metals) from Norilsk Nickel Harjavalta for
further processing at Polar Division.
In 2019, palladium and platinum output amounted to 2,922 koz (+7% y-o-y) and
702 koz (+8% y-o-y), respectively. The increase of PGMs output was
attributed to the release of work-in-progress inventory at Krasnoyarsk
Precious Metals Refinery and processing of the feed purchased from third
parties at Norilsk Nickel Harjavalta.
Overall, in 2019 PGMs output from the Company's own Russia feed was above
the production targets for palladium of 2,770-2,800 koz and 646-670 koz for
platinum.
RUSSIAN OPERATIONS
In 2019, all saleable metals produced by the Company's Russian operations
were from their own feed.
Nickel
In 4Q19, nickel output at Kola MMC increased 13% q-o-q to 46 kt. Substantial
increase of nickel output in 4Q19 was attributed to increase in production
of nickel concentrate for sale to third parties and expansion of carbonyl
nickel production capacity at Kola MMC to 1.7 kt (4-fold growth q-o-q).
In 2019, the Company's nickel output in Russia increased 5% y-o-y to 166 kt.
The growth was primarily attributed to the gradual ramp-up of nickel
refinery operating new chlorine-leaching technology, expansion of carbonyl
nickel production at Kola MMC to 4.4 kt (+75% y-o-y) and the launch of
low-grade nickel concentrate production for the sale to third parties at
Kola MMC.
Copper
In 4Q19, copper output at the Company's operations in Russia increased 6%
q-o-q to 126 kt. The growth was attributed to the increase in mined ore
volumes and higher copper grades at Polar Division, increased processing
volumes of copper concentrate received from Kola MMC and copper cake
received from Norilsk Nickel Harjavalta at the Polar Division's Copper Plant
as well as the ramp-up of Bystrinsky (Chita) Project.
In 2019, the Company's Russian operations increased copper output 7% y-o-y
to 486 kt. The growth was attributed to the gradual ramp-up of Bystrinsky
(Chita) Project as well as higher volumes of copper concentrate produced for
the sale to third parties and copper cathodes from the matte received from
the Polar Division at Kola MMC.
Bystrinsky Project was ramping-up on schedule, having increased production
more than two-fold y-o-y to 43 kt of copper in copper concentrate.
Platinum Group Metals
In 4Q19, the Company's palladium and platinum output in Russia amounted to
664 koz (-6% q-o-q) and 148 koz (-8% q-o-q), respectively. Lower production
was attributed to the commissioning of the new precious metals concentrate
production line at the metallurgical shop at Kola MMC. The new precious
metals production line at Kola MMC has been launched as part of nickel
refinery upgrade to a new nickel electrowinning technology, whereby precious
metal concentrates will be produced from residue of chlorine leaching.
In 2019, palladium and platinum output amounted to 2,868 koz (+7% y-o-y) and
690 koz (+8% y-o-y), respectively. The PGM production volumes increased
primarily owing to processing of work-in-progress inventory.
NORILSK NICKEL HARJAVALTA (FINLAND)
Nickel
In 4Q19, nickel production at Norilsk Nickel Harjavalta decreased 5% q-o-q
to 16 kt. The decrease was a result of a three days-long production stoppage
in November 2019 due to a scheduled «solidarity» strike in Finland in
support of postal workers.
In 2019, nickel output at Harjavalta increased 3% y-o-y to 62 kt. The
increase was attributed to higher volumes of nickel feed received from
Boliden for further processing.
Copper
In 4Q19, copper output at Norilsk Nickel Harjavalta decreased 69% q-o-q to
1kt. The decrease was attributed to a trial shipment of copper cake from
Norilsk Nickel Harjavalta to Copper Plant of the Polar Division for further
refining, while the copper cake was previously sold to third parties.
In 2019, copper output at Harjavalta decreased 28% y-o-y to 13 kt. The
reduction was owing to the trial shipment of copper cake from Norilsk Nickel
Harjavalta to Copper Plant of the Polar Division for further refining and
the high base effect of the previous year, when work-in-progress concentrate
was processed.
Platinum Group Metals
In 4Q19, output of saleable palladium and platinum (both contained in copper
cake) amounted to 5 koz (down 64% q-o-q) and 1 koz (down 73% q-o-q),
respectively. The reduction was attributed to the trial shipment of copper
cake containing precious metals from Norilsk Nickel Harjavalta to Copper
Plant of the Polar Division for further refining.
In 2019, output of palladium and platinum amounted to 54 koz (-8% y-o-y) and
12 koz (+5% y-o-y), respectively. The decrease in palladium production was
attributed to the trial shipment of copper cake from Norilsk Nickel
Harjavalta to Copper Plant of the Polar Division for further refining.
NKOMATI (SOUTH AFRICA) (*)
In 2019, output at Nkomati (50% - owned by Norilsk Nickel) amounted to 6 kt
of nickel (-2% y-o-y), 3 kt of copper (+12% y-o-y), 33 koz of palladium (-1%
y-o-y) and 14 koz of platinum (+6% y-o-y). The decrease in nickel and
palladium output and increase in copper and platinum output in the reported
period was attributed to a change in the mined ore mix and launched scale
down of production as part of the asset conservation plan scheduled for
completion by 2021.
Note: Nkomati production results are not consolidated in the Group's total
operating results.
Production Guidance from the Company's Russian feedstock for 2020:
Metal Volume
Norilsk Nickel Group (excluding Chita)
Ni, kt 225-235
Cu, kt 420-440
Pd, koz 2,648-2,777
Pt, koz 611-675
Bystrinsky (Chita) Copper Project (1)
Cu, kt 55-65
Au, koz 220-240
Note: 1.Norilsk Nickel owns 50.01% of Bystrinsky (Chita Copper) Project.
Production results are shown metal in concentrate for sale on 100% basis.
Production results are consolidated in total operational results on 100%
basis. The concentrator at the Bystrinsky project was launched in 2018 as
part of the hot commissioning stage and was fully commissioned in September
2019.
NORILSK NICKEL 4Q 3Q Q-o-Q 2019 2018 Y-o-Y
GROUP SALEABLE 2019 2019
METALS
PRODUCTION 1
Total nickel t 61,739 57,266 8% 228,687 218,770 5%
including from t 60,758 56,705 7% 225,204 216,856 4%
own Russian feed
Total copper t 127,148 120,667 5% 499,119 473,654 5%
including from t 127,124 120,614 5% 498,838 473,515 5%
own Russian feed
Total palladium koz 669 720 -7% 2,922 2,729 7%
including from koz 669 719 -7% 2 919 2,729 7%
own Russian feed
Total platinum koz 149 164 -9% 702 653 8%
including from koz 149 164 -9% 700 653 7%
own Russian feed
Polar division
and Kola MMC
(Russia)
Nickel t 45,752 40,474 13% 166,265 158,005 5%
Kola MMC, t 45,752 40,474 13% 166,265 158,005 5%
including
refined Ni from t 37,378 36,655 2% 153,558 148,839 3%
own Russian feed
Ni in saleable t 8,374 3,819 119% 12,707 8,680 46%
concentrate from
own Russian feed
from 3d parties t 0 0 - 0 486 -100%
feed
Copper t 113,377 106,145 7% 442,682 436,201 1%
Polar division t 90,736 85,248 6% 355,706 353,131 1%
Kola MMC, t 22,641 20,897 8% 86,976 83,070 5%
including
Cu cathodes from t 21,115 18,150 16% 75,093 72,826 3%
own Russian feed
Cu in saleable t 1,526 2,747 -44% 11,883 10,161 17%
concentrate from
own Russian feed
from 3d parties t 0 0 - 0 83 -100%
feed
Palladium koz 664 707 -6% 2,868 2,671 7%
Polar division koz 288 293 -1% 1,042 987 6%
Kola MMC, koz 376 414 -9% 1,826 1,684 8%
including
from own Russian koz 376 414 -9% 1,826 1,684 8%
feed
from 3d parties koz 0 0 - 0 0 -
feed
Platinum koz 148 162 -8% 690 642 8%
Polar division koz 67 70 -4% 251 260 -3%
Kola MMC, koz 81 92 -12% 439 381 15%
including
from own Russian koz 81 92 -12% 439 381 15%
feed
from 3d parties koz 0 0 - 0 0 -
feed
GRK Bystrinskoye
(Zabaykaisky
Krai) 2
Copper t 12,563 10,673 18% 43,489 19,417 124%
Gold koz 49 41 20% 177 89 99%
Iron ore kt 478 328 46% 1,311 346 279%
concentrate
Norilsk Nickel
Harjavalta
(Finland)
Nickel, t 15,987 16,792 -5% 62,422 60,765 3%
including
from own Russian t 15,006 16,231 -8% 58,939 59,337 -1%
feed
from 3d parties t 981 561 75% 3,482 1,428 144%
feed
Copper, t 1,208 3,849 -69% 12,948 18,036 -28%
including
from own Russian t 1,184 3,796 -69% 12,667 17,980 -30%
feed
from 3d parties t 24 53 -55% 281 56 401%
feed
Palladium, koz 5 13 -64% 54 58 -8%
including
from own Russian koz 5 12 -62% 51 58 -13%
feed
from 3d parties koz 0 1 -100% 3 0 100%
feed
Platinum, koz 1 3 -73% 12 11 5%
including
from own Russian koz 1 2 -67% 9 11 -15%
feed
from 3d parties koz 0 1 -100% 2 0 100%
feed
Nkomati (South
Africa) 3
Nickel t 1,521 1,172 30% 6,485 6,597 -2%
Copper t 731 717 2% 3,419 3,055 12%
Palladium koz 7 6 13% 33 33 -1%
Platinum koz 3 3 9% 14 13 6%
Notes:
1) Totals may value from the sum of numbers as a result of rounding. The
production results of Nkomati is not reflected in totals of Norilsk Nickel
Group.
2) Norilsk Nickel Group owns 50.01% of Bystrinsky GOK (Chita Copper
Project). Production results are shown metal in concentrate for sale on
100% basis and fully consolidated in total operational results. The
concentrator at the Bystrinsky project was launched in 2018 as part of the
hot commissioning stage and was fully commissioned in September 2019.
3) Norilsk Nickel Group owns 50% of Nkomati. Production results are shown
metal in concentrate for sale on 50% basis and not consolidated in total
operational results. The mine will be put on care and maintenance as part
of the asset conservation plan scheduled for completion by 2021.
This announcement contains inside information in accordance with Article 7
of EU Regulation 596/2014 of 16 April 2014.
Full name and position of person making the announcement - Vladimir Zhukov,
Vice - president, Investor Relations.
ABOUT THE COMPANY
PJSC «MMC «NORILSK NICKEL» is a diversified mining and metallurgical
company, the world's largest producer of palladium and high-grade metal
nickel and a major producer of platinum and copper. The company also
produces cobalt, rhodium, silver, gold, iridium, ruthenium, selenium,
tellurium, sulphur and other products.
The production units of «NORILSK NICKEL» Group are located at the Norilsk
Industrial District, on the Kola Peninsula and Zabaykalsky Krai in Russia as
well as in Finland and South Africa.
PJSC «MMC «NORILSK NICKEL» shares are listed on the Moscow and on the
Saint-Petersburg Stock Exchanges. PJSC «MMC «NORILSK NICKEL» ADRs are traded
over the counter in the US and on the London, Berlin and Frankfurt Stock
Exchanges.
Media Relations: Investor Relations:
Phone: +7 (495) 785 58 00 Phone: +7 (495) 786 83 20
Email: pr@nornik.ru Email: ir@nornik.ru
ISIN: US55315J1025
Category Code: MSCH
TIDM: MNOD
Sequence No.: 43890
EQS News ID: 965191
End of Announcement EQS News Service
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January 31, 2020 05:00 ET (10:00 GMT)
