To always have copper...
Implementation of the main objectives of the strategy is based on three executive and three supporting strategies. The first pillar of the strategy is the “Development of Domestic and Foreign Assets” through an effective investment management and an execution of resource–related projects. Investments and capital expenditures in the KGHM Polska Miedź S.A. Capital Group for 2017-2021 are assumed at the level of PLN 15 bn, out of which PLN 9.7 bn is attributed to KGHM Polska Miedź S.A. The focus - within the domestic assets - is on the crucial projects, such as: Ore Access Program, Smelting Development Program, Expansion of the “Żelazny Most” waste treatment tailings pond and performing of exploration works in a direct neighborhood of the currently mined areas. The strategy assumes optimization of the foreign assets portfolio, including measures to achieve production maturity of Sierra Gorda mine, and focuses on assets of the greatest production potential.
The second pillar, the “Production and Safety ” assumes an average annual copper in ore production rate in Poland at the level exceeding 470 thousand tons of Cu, and an average production rate from the overseas assets at the level of about 145 thousand tons of payable copper between 2017 and 2021. Electrolytic copper production of the Group will reach the level above 570 thousand tons a year. Focus on workers safety, risk mitigation to maintain a stable production level and an improvement of operational and cost effectiveness on each stage of the main technological chain are the key determinants of the second pillar.
The third pillar is the “Coherent Organisation ”. It assumes introduction of systemic solutions that will integrate subsidiaries of the Group into an effectively operating mechanism, focused on the KGHM’s Group value creation.
One of the three supporting strategies is the “Corporate Social Responsibility”. Its task is to create and maintain a positive image of the Group, based on cooperation and communication with stakeholders. A role of the intellectual capital, protection of the intellectual property, and primarily the effective innovations management relate to the supporting strategy called the “Innovations”, which is focused on delivering an increase in productivity within the KGHM Group. The third supporting strategy called the “Financial Stability” is expected to ensure a financial security of the Group. The strategy is directed at the optimization of external financing, the improvement of the risk management process and ensuring immunity to the changeable market conditions.
- First of all, it is a realistic strategy. It takes into consideration financial abilities of the KGHM Group, as well as the dynamic transformations that take place in the mining industry, which are caused by macroeconomic, technological, social and legislative challenges. They are a challenge to us and they are the reason for evaluation of strategic assumptions of the Company’s operations. Being embedded into the concept of sustainable development, we go for a rational and effective use of natural resources. Focused on innovative solutions and the development of our assets, our goal is to maintain stable and safe production, bring profits for us and for our stakeholders - said Radosław Domagalski - Łabędzki, President of the Board of KGHM Polska Miedź S.A.
It was necessary to prepare this new strategy because of the change in macroeconomic conditions and the dynamic changes taking place in the non-ferrous metals mining and metallurgy industry. The main objective of the strategy presented in 2015, assuming production of 1 mn tons of copper equivalent, was impossible to achieve because of the changes in the assumptions concerning production volumes from domestic and national assets. In addition, the five-year investment plan was rationalized, as a response to macro-economic transformations that have taken place in recent years. High risk of some investment projects and the necessity to secure handling the current financial liabilities and responsibility for stable long-term operations of the Company and the Group, in relation to assumptions of the sustainable development, create the foundations for the new strategy.
- Our mission, to always have copper , supports the vision of an effective use of our resources, to be a leader of the sustainable development. This means to operate generating profits not only today and not only for us, but also for future generations. - said Rafał Pawełczak, Vice President of KGHM Polska Miedź S.A.
