Capstone projects 40% copper output growth at Mexico mine in 2021

Pittsburgh — Capstone Mining expects copper output at its Cozamin mine in Mexico to rise over 40% in 2021 after the completion of an expansion program this year, the company said Wednesday.

"At Cozamin, a level of confidence is expected that post-expansion production will increase to between 50 million lbs and 55 million lbs of copper and 1.5 million oz of silver by 2021 and beyond," CEO Darren Pylot said to investors during a call. "This confidence continues to increase as we remain on track to complete the one-way ramp for the end of 2020."

The projected range of 50 million-55 million lb would represent a significant increase from Cozamin's annual copper production of 35.8 million lb in 2019.

Capstone commissioned the development of the one-way ramp and improved ventilation system at Cozamin this year to expand the mine and debottleneck ore haulage, the company said in a statement.

The Vancouver-based company is also nearing the completion of an infill drilling program at Cozamin with plans to double the site's mine life.

"We've operated it now for over 13 years, and it looks like the best is yet to come at this mine," Pylot said. "We expect to release an updated mineral reserve and resource estimate and a technical report in the fourth quarter of this year."

Capstone's total 2019 copper production slipped to 153.4 million lb from 155.2 million lb in 2018. The company's Q4 output dropped to 35.4 million lb of copper from 42.3 million lb in the year-ago period. The decrease in production was largely attributable to Capstone's Pinto Valley mine in Arizona, where Q4 copper production fell by about 7 million lb year over year.

Operations at Pinto Valley were impacted in Q4 due to downtime at the mine's fine crushing plant as Capstone performed maintenance upgrades and operational tests to increase throughout levels beyond current capacity, the company said.

Capstone's Q4 net profit rose to $13.4 million on revenue of $113.6 million from a $39 million loss on $98 million in revenue in Q4 2018.

The copper miner reported a 2019 full-year net loss of $16.2 million on sales of $418.7 million, compared with a loss of $23.6 million on $415.9 million sales in 2018.