OZ pot of gold

A newly positive financial position will allow OZ Minerals to consider small acquisitions in the immediate future.

A vastly improved financial position has put OZ Minerals in a position to consider future acquisitions, acting chief executive Bruce Loveday told journalists in a teleconference yesterday.

The release of OZ Minerals’ second quarter update revealed that the miner now has cash reserves of around US$800 million after finalising the sale of nearly all of its assets to China Minmetals for US$1.354 billion.

Loveday said it is too early to say how the money is to be spent, but that some would most likely be used for expansions at its remaining Prominent Hill mine, as well as possible asset purchases.

“We think there is the likelihood of some bolt-on, smaller type acquisitions,” Loveday said.

“Whether or not the company tries to undertake any substantial acquisition in the future it will do so on a prudent basis.”

According to its report, production at OZ Minerals’ Prominent Hill copper and gold mine in South Australia is on track to meet its earlier guidance levels.

The report showed that 27,159 tonnes of copper was mined at Prominent Hill in the three months to June 30, with 18,351 ounces of gold also produced.

These results mean that production at Prominent Hill was on track to meet previous guidance of 85,000 to 100,000 tonnes of copper and 60,000 to 70,000 ounces of gold for the year, OZ said.

Loveday said that despite recent low prices, he remained hopeful about the future of copper as a profitable commodity.

“We remain of a view that the fundamental outlook for copper on a two to five year time horizon is actually very robust,” he said.

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