Vedanta Zinc produces 36% less zinc in Q1FY2021

Vedanta Zinc International has reported that total production for the first quarter of FY2021 was 38,000 tonnes, lower by 36% as compared to Q1FY20 and 34% as compared to Q4FY20 mainly due to Skorpion undergoing maintenance from April 2020 because of multiple slope failures in FY20 and also COVID-19 impact which resulted in production resuming from 17th April 2020 at BMM and Gamsberg mines.
Skorpion produced 700 tonnes in Q1FY21 as compared to 18,000 tonnes in Q1FY20 and 15,000 tonnes in Q4 FY20. In May 2019, Skorpion experienced a major open pit failure which resulted in an ore gap of four months – which thus required the stoppage of the Refinery from November 2019 to January 2020.

The failure was safely and successfully mined out. However, further (smaller) failures have since occurred with the latest one in January 2020 sterilizing a significant portion of the open pit. This has resulted in an ore gap in excess of 10 months. Further technical studies have indicated the likely existence of similar such failure structures at depth.
All mining operations at Skorpion have been decided to be ceased, while studies continue to look at feasible ways to make the pit safe for mining options which would allow for the extraction of the remainder of the accessible ore.
BMM produced 12,000 tonnes in Q1FY21 as compared to 19,000 tonnes in Q1FY20. Tons processed were 276,000 in Q1FY21 as compared to 399,000 in Q1 FY20 with substantially lower lead grades.
BMM production was flat sequentially. Production was mainly impacted by COVID-19 related lockdown which resulted in the mine only starting on 17th April at 50% capacity in line with government regulations. Production in Q4FY20 was impacted by suspension of mining operations for 16 days on account of a fatality.
Gamsberg’s production was 25,000 tonnnes in Q1 FY21, 11% higher as compared to Q1 FY20 due to higher throughput and zinc grades and was lower 15% as compared to Q4 FY20, mainly due to impact of COVID-19 related lockdown and lower throughput and recoveries.
During FY20, total production was 240,000 tonnes, higher 63% as compared to FY19 on account of commencement of production from Gamsberg. While Skorpion and BMM production was in line with previous year, Gamsberg produced 108,000 tonnes vs 17,000 tonnes.

Gamsberg Mining has fully ramped up to 4 Mtpa capacity and ~1.8 Mt of healthy ore stockpile has been built ahead of plant as on March 2020. Recovery continues to be a focus area as the plant ramps up and is stable.

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