KGHM and South32 become joint operators of the Chilean mine Sierra Gorda

As of 22 February 2022 KGHM has a new partner in the company Sierra Gorda SCM. Following the close of the transaction involving the sale of all of the shares held in this Chilean mine by Sumitomo Metal Mining Co., Ltd. and Sumitomo Corporation, the shares were transferred to the Australian mining group South32.

 „Sierra Gorda is a demanding and at the same time extremely satisfying project. We have been exerting tremendous efforts and focusing our attention to reverse a multi-year trend and achieve the desired effect. Nonetheless, the mine’s results after 3 years of our intensive work on the project are impressive. For the first time positive cash flow has moved from overseas to Poland. We achieved this thanks to a change in management style and consistency in implementation of corrective solutions. We will continue to act with our new partner to develop and consequently increase the asset’s value,” said Marcin Chludziński, President of KGHM Polska Miedź S.A.

Adjusted EBITDA of the KGHM Group for the first three quarters of 2021 compared to the corresponding period of 2020 was higher by PLN 3 312 million. This was mainly due to KGHM Polska Miedź S.A. (+PLN 1 220 million), Sierra Gorda (+PLN 1 458 million (on a 55% basis)  – nearly 3x higher), and KGHM INTERNATIONAL LTD. (+PLN 598 million). Amongst others these higher results were due to an increase in revenues resulting from higher metals prices and lower costs of goods sold.

„We welcome aboard our new partner and convey our hopes for successful business cooperation as regards Sierra Gorda. At the same time we wish to thank Sumitomo for their trust and efforts made in achieving the best possible results in this project,” said Paweł Gruza, Vice President of KGHM (International Affairs).

About South32

The new partner in Sierra Gorda is a globally diversified metals and mining company headquartered in Perth, Australia. South32 has a diversified portfolio of mining projects, with operations in Australia, Africa and in North and South America. Among others, the company sells aluminium, alumina, metallurgical coal, manganese, nickel, silver, lead and zinc.