Newmont Slump Hurts BRM Profit
A loss in income from copper and gold miner Newmont Nusa Tenggara caused profit at Bumi Resources Minerals to slump in the first half by 96 percent.
Bumi Resources Minerals, a metal and mineral mining unit of coal producer Bumi Resources, posted $1.9 million in net income in the January-June period, down from $52.1 million in the same first half last year, the company said in a statement released on Thursday.
Revenue at the company rose 56 percent to $11.97 million.
However, its income from the shares it owns in Newmont Nusa Tenggara (NNT) swung to a loss of $4.18 million, after a $65.82 million gain a year earlier. BRM has an 18 percent stake in the copper and gold miner, while Newmont Mining holds a 56 percent controlling interest.
The income contribution dropped from NNT as its production declined, BRM said in the statement.
Copper production fell to 85 million pounds in the first half from 141 million pounds a year earlier, while its average selling price dropped 12 percent to $3.49 per pound at NNT.
Production of gold dropped to 38,000 ounces from 143,000 ounces even as prices rose 12 percent to $1,643 per ounce.
“This temporary production drop has been anticipated due to the ongoing phase six development in the Batu Hijau mine site,” said Herwin Hidayat, vice president for investor relations at BRM. “Once phase six is completed, by the end of this year, Newmont Nusa Tenggara is expected to increase its copper and gold outputs significantly in year 2013.”
Herwin also believes that the company’s stake in NNT will be fruitful in the future after Newmont Mining’s head of Asia Pacific operation said that its Elang site could have a larger deposit than its Boddington mine in Australia.
Meanwhile the company secured its exploitation permit for zinc and lead concession in North Sumatra for its 11 million tons of reserve and 25 million tons of resource in the area based on an estimate by the expert Joint Ore Reserves Committee.
It is also in the middle of exploring several sites for its copper and gold concessions in Sulawesi, BRM said.
“The company expects to announce the Joint Ore Reserve Committee resource estimates from the respective sites by end of this year,” Herwin said.
The copper and gold concessions are operated by its subsidiary Gorontalo Minerals and Citra Palu Minerals.