First Quantum Minerals Share Discussion Threads

[wirralowl] 14/2/2003 13:49

If my figures are correct (?) this company appears dirt cheap, and with the financing now in place for Kansanshi, if you can take a long-term view, this has to be a low-risk/potentially high-gain mining investment.

Kasanshi is expected to be able to produce around 165m lbs of copper per year
at a net cash cost of US$0.40 cents/lb. Now the average price obtained last year by FQM was US$0.82/lb ie a 40 cents / lb profit.

Assuming price of Cu stays the same (in actual fact it is now higher than last year's average):

165m x .42 = $69.3m / year pre-tax profit.

or approx £42m pre-tax.

Say they are taxed @ 40% = after-tax profits of £25.2m (and remeber this is just from the Kasanshi mine!)

And this against a market cap currnetly of around £100m !

Recent article in Shares Mag got me interested again, when they estimated that by 2006 their combined production could yield £40m after tax - putting FQM on a forward PE of just over 2 !

I hold a few from a while back, but will probably add over the next few months if someone doesn't tell me I'm talking complete rubbish.

Apologies if my maths is over-simplisitic, but I would appreciate any comments from more experienced 'mining' investors.

Cheers,
WirralOwl

[rambutan2] 16/1/2003 11:58

all still going well...

First Quantum Minerals (FM : TSX : C$3.90) - Strong Buy - 12-month target
price: C$6.50
Greg Barnes
Comment: Larger resource at Lonshi adds to mine life First Quantum
announces that the open-pit resource at Lonshi has increased
from 5.1 million tonnes to 7.3 million tonnes, while copper grade has been
revised lower from 5.75% to 4.91%. Contained copper increased over 60,000
tonnes to 356,000 tonnes. These results are based on 187 drill holes (134
reverse circulation, 16 diamond core, 37 Aircore) totaling 9,187 metres.
The additional measured and indicated resources outlined at Lonshi have
enabled us to extend the mine life for the Lonshi operation in our model
by approximately two years (from six years to eight years), assuming
annual production from the Bwana Mkubwa plant of roughly 30,000 tonnes
per year of cathode copper.Increasing the mine life at Lonshi is accretive to
our net asset value. Our total net asset value for First Quantum, based on
a 15% discount rate and a long-term copper price of US$0.85/lb, is now
C$6.74/share (assuming dilution of First Quantum's share base to reflect
additional financing for the development of the Kansanshi Project). This
compares to our previous net asset value of C$6.45/share. We are
maintaining our STRONG BUY recommendation and C$6.50 target price.

[mr ashley james] 09/12/2002 11:36

Rambutan,

Up 10.30% this am, not holding but nice move.

Cheers

Ashley

[rambutan2] 07/12/2002 16:44

FIRST QUANTUM MINERALS FIXES PRICE FOR CDN $17.875 MILLION
SPECIAL WARRANTS OFFERING



First Quantum Minerals Ltd. (TSE Symbol 'FM', LSE Symbol 'FQM') is pleased to
announce that further to the Company's news release dated November 21, 2002, it
will complete a private placement of 5.5 million Special Warrants at $3.25 per
Special Warrant to raise approximately CDN $17.875 million. Each Special
Warrant will entitle the holder to receive one Common Share of First Quantum
without payment of additional consideration. The offering is expected to be
completed on December 19, 2002. Completion of the private placement is subject
to certain conditions including the receipt of all necessary regulatory
approvals. RBC Capital Markets is the lead agent for the syndicate of
underwriters involved in the private placement.



The net proceeds of the offering will be used to assist in funding the
development of the Kansanshi copper project in Zambia, in which the Company
holds an 80% interest, working capital at the Bwana Mkubwa copper operation and
general corporate purposes.



This news release shall not constitute an offer to sell shares or the
solicitation of an offer to buy the securities in any jurisdiction. The Special
Warrants and the Common Shares will not be registered under the United States
Securities Act of 1933, as amended, and may not be offered or sold in the United
States absent registration or applicable exemption from registration
requirement.

[rambutan2] 25/10/2002 10:42

Oops, didnt mean to post the whole list.
Here is minesites take on the report and FQMs position:

Date : October 25, 2002
United Nations Appears To Have Skimped on Homework Before Accusing Companies Of Violating OECD Guidelines.

It looks as if the United Nations Security Council has gone crashing into the Democratic Republic of Congo in its size 15 boots just at the wrong time. No one ever thought it was going to be easy to broker peace in the country as there had just been too many warring factions there with forces from Rwanda, Uganda and Zimbabwe all involved for their own good. Needless to say the withdrawals are not going to plan despite the best endeavours of President Joseph Kabila and his government who have now gained the support of the World Bank.

These are difficult times, therefore, and it seems particularly insensitive of the UNSC to come out with a recommendation that financial sanctions be imposed on no less than twenty nine companies operating there. Sure, there are bound to be some bad eggs operating in a country destabilised by a long civil war, particularly if the country is as rich in metals and minerals as the DRC, but it is usually better to check facts rather than shoot from the hip. And the United Nations has done itself no favours in terms of maintaining credibility among the companies named in its Annex 3 as having violated OECD Guidelines for multinationals in the course of operations in the DRC. Facts have to be checked and double-checked if companies are going to be accused of such misdemeanours.

A case in point is First Quantum Minerals, listed on Toronto and the AIM market, which was accused of offering bribes to secure rights to the Kolwezi tailings in the following terms "First Quantum offered a down payment to the State of US$100 million, cash payments and shares held in Trust for Governmental officials. The FQM share offer to those officials was premised on a sharp rise in its share price once it was announced that it had secured some of the most valuable mineral concessions in the DRC". Philip Pascall, chairman and CEO of First Quantum, hardly drew breath before firing back the following response. "First Quantum would like to point out that the information contained within the Report is factually incorrect and that all allegations included or implied within the Report are categorically refuted. Furthermore, the Company is concerned that the United Nations would publish such baseless allegations before substantiating the facts with First Quantum representatives. First Quantum intends to pursue, by all means available, a full retraction of the allegations contained within the Report"

This is not the reply of a man fearing there are any skeletons in the First Quantum cupboard and further details have followed, including a denial that First Quantum was ever involved in bidding for any part of the Kolwezi tailings project. As Pascall points out, what First Quantum bid US$100 million for was the Group West mines which were the subject of a major public tender that attracted a large number of mining companies back in 1997. The tenders were opened in front of all the bidders in a properly conducted official procedure in Belgium and the Group West mines were eventually awarded to the Group West consortium which was made up of a number of mining companies including FQM, Anglo American, BHP Billiton, Noranda and a number of others.

Clearly the lawyers are going to make hay out of this one as First Quantum is demanding to see what documentary evidence the UN has to back its allegations. Even more bizarre is the preponderance of blue chip companies among the total of eighty five accused of violating the said OECD guidelines. It certainly must have come as a bolt out of the blue for the South African company Zincor to see its name there as it claims never to have had anything to do with the DRC.

Anglo American is also spitting blood about having its name mentioned because, as a director said in an interview with a South African radio programme, "we've had no operations in the DRC , or Zaire as it was formerly, for decades." This statement, however, is somewhat at odds with the fact that Anglo American, or rather its subsidiary Anglo Base Metals, pulled out of a joint venture with the Canadian junior, America Mineral Fields, on the Kolwezi copper/cobalt tailings deposits only this summer.

Yes, the very same Kolwezi deposits that First Quantum is said by the United Nations to have bid for. At this stage it hardly takes a brain surgeon to suspect that the homework that preceded this report must have been a bit sketchy to say the least. But this will not calm the big boys such as Ashanti Goldfields, Barclays Bank, Bayer AG, Cabot Corporation and Standard Chartered Bank who all get a mention. They cannot simply ignore such an accusation and it is even more difficult for the juniors involved in legitimate operations in the country. Bernie Pryor, chief operations officer of America Minerals Fields said, "we are extremely upset to be mentioned in this report. We have been given no information regarding the allegations and the UN Panel has made no effort to contact us."

It is now up to the United Nations to produce the facts or else come out with abject apologies. And quickly.

[rambutan2] 23/10/2002 10:30

What's this about then?
October 22, 2002

www.first-quantum.com

FIRST QUANTUM'S STATEMENT REGARDING UNITED NATIONS REPORT NO. S/2002/1146

First Quantum Minerals Ltd. (TSE Symbol "FM", LSE Symbol "FQM") issued the
following statement in reference to the recently published United Nations Report
No. S/2002/1146.

"With reference to the comments relating to First Quantum Minerals Ltd.
contained within the United Nations Report No. S/2002/1146 ("Report"), First
Quantum would like to point out that the information contained within the Report
is factually incorrect and that all allegations included or implied within the
Report are categorically refuted. Furthermore, the Company is concerned that
the United Nations would publish such baseless allegations before substantiating
the facts with First Quantum representatives. First Quantum intends to pursue,
by all means available, a full retraction of the allegations contained within
the Report" stated Philip Pascall, Chairman and CEO of First Quantum Minerals
Ltd.

On Behalf of the Board of Directors 12g3-2b-82-4461
of First Quantum Minerals Ltd. Listed in Standard and Poor's
"G. Clive Newall" Sedar Profile £00006237
G. Clive Newall

[rambutan2] 09/10/2002 00:14

They are going to find some more v nice deposits where they are looking.


NEWS RELEASE
02-12
October 7, 2002
www.first-quantum.com


FIRST QUANTUM UPDATES EXPLORATION ACTIVITIES

-EIGHT KILOMETER LONG COPPER-COBALT TARGET IDENTIFIED AT MWINILUNGA, ZAMBIA-


First Quantum Minerals Ltd. (TSX Symbol "FM", LSE Symbol "FQM") is pleased to
provide an update of its exploration activities in the Copperbelt of Zambia and
the Democratic Republic of the Congo. An aggressive grassroots program for new
major copper deposits is underway on wholly owned properties in both countries,
and in joint venture with BHP Billiton in Zambia.


BHP Billiton Joint Venture, Zambia

BHP Billiton (BHPB) is farming into the First Quantum Mwinilunga and Luamata
prospecting licenses (the "Projects"), which cover over 8,500 square kilometers
of highly prospective geology in Northwest Zambia.

Under the terms of the Joint Venture Agreement announced last year, BHPB
completed a private placement in First Quantum for 222,222 common shares at a
price of Cdn. $4.50 per share. A minimum of US $600,000 from the proceeds of
this private placement is being used for further exploration on the Projects.

To date, in excess of $400,000 of the private placement proceeds have been spent
on data compilation, soil sampling and reconnaissance drilling. The objective of
the exploration program is to locate world class Copperbelt type copper deposits
within the southwestwards continuation of the Copperbelt into Zambia from the
Congo which are largely covered by Kalahari sands of variable thickness. The
deposits sought are typically sheet-like, frequently associated with major folds
with strike and down dip dimensions being kilometric in scale.

Target areas were selected on the basis of favorable geology and structure as
defined by mapping, airborne geophysics, and stream sediment geochemistry.
Conventional soil sampling is being utilized in areas of shallow cover, while "
base of cover" sampling using Rotary Air Blast (RAB) drilling is being employed
in the more thickly covered areas. Results have been very encouraging; with a
several areas of anomalous copper geochemistry outlined in areas of thin cover.

One of these anomalies, Musangila, comprises an 8 kilometer long, > 100ppm
copper soil anomaly, interpreted to lie on the limb of a major fold structure.
Initial RAB drilling, on wide spaced lines, has intersected strongly anomalous
copper and cobalt values towards the base of Kalahari cover, which is 5 to 50
metres thick. Copper mineralisation (peak 1.32% copper), is present as malachite
and chrysocolla clasts within Kalahari clay, and in quartzite clasts with
interstitial disseminations of malachite. High cobalt values, (peak 2.01%
cobalt), are associated with black wad, and gossanous fragments with vuggy
quartz clasts present towards the base of the cover sequence in most of the
holes drilled into the peak of the anomalies. Follow up core hole drilling is
planned to locate the bedrock source of this mineralization.


Congo Pedicle, Democratic Republic of the Congo

In late 2000, the First Quantum exploration team discovered the high grade
Lonshi deposit (5.1 million tonnes grading 5.75% copper) which entered
production in September 2001. This deposit is located in the southeastward
continuation of the Copperbelt from Zambia into the Congo Pedicle, an area that
has received very little prior exploration.

First Quantum is currently conducting an aggressive reconnaissance program aimed
at seeking extensions to the Lonshi deposit, and at discovering new deposits.
Targets are selected on the basis of satellite imagery interpretation of geology
and structure, with systematic grid soil sampling and follow up RAB drilling.
Several attractive anomalies have been defined, and further results will be
announced in due course.

Alan J. Stephens, BSc(Hons), ARSM, Vice President, Exploration of First Quantum
Minerals Limited, a geologist with more than 26 years experience in the mining
industry, is the qualified person responsible for the design and conduct of the
work performed.

[rambutan2] 08/10/2002 13:00

By Loch Adamson
Ospraie Funds' Dwight Anderson is part of a new generation of hedge fund managers making money for investors in hard times.

The above intro from a piece in Worth mag was about a top commodity fund manager and worth - gettit! - a read. He carries out huge amounts of research across the commodity spectrum to find out pricing anomolies. In any case, he's long on copper. FQM is the best copper play in London.

[rambutan2] 26/9/2002 19:10

On track with their plans:


September 26, 2002


FIRST QUANTUM BEGINS COMMISSIONING OF EXPANSION AT BWANA MKUBWA SX/EW FACILITY

First Quantum Minerals Ltd. (TSX Symbol "FM", LSE Symbol "FQM") is pleased to
announce that commissioning of the Phase Two expansion has begun at the Bwana
Mkubwa SX/EW facility in Zambia. Phase Two construction expanded the leach,
filtration, solvent extraction and electrowinning facilities to a minimum
production capacity of 30,000 tonnes (66 million pounds) of LME "A" grade copper
cathode per year from the current 10,000 tonnes (22 million pounds) LME "A"
grade copper cathode per year.

First fill of reagents is underway and "wet" circuit testing will begin shortly.
During the remainder of the Fourth Quarter, fine-tuning and optimization of
the leach, filtration, solvent extraction, and electrowinning facilities, and
build-up of in circuit inventory will take place with the aim of reaching an
annual production rate of 30,000 tonnes of copper cathode during the First
Quarter of 2003.

"With the bulk of mechanical construction complete, we will focus our efforts on
producing copper cathode. While there are always inherent gremlins to work out
during the commissioning process, we gained valuable experience from processing
high grade Lonshi ore during the Second and Third Quarters from which we will
benefit as we move forward." commented Philip Pascall, Chairman, First Quantum
Minerals.

[mr ashley james] 17/9/2002 11:50

Roland,

Up 10p or 7.80%, but you won't touch Zambia so it is frankly irrelevant to you.

Idiot you missed out again.

Cheers

Ashley

[rolandp] 25/8/2002 00:54

Ashley
I heard that too, possibly the same source. However, the "exit arrangement" detail does not suggest this is correct. Did you look at it?
Agreed the FQM property a different kettle of fish tho'.
Regards
R

[mr ashley james] 24/8/2002 10:19

Roland,

I understand AAL were kicked out of Zambia, very good news for FQM IMHO.

Cheers

Ash

[rambutan2] 24/8/2002 03:06

Anglo, a different kettle of fish. Big company, big plans, big spending, then, a change of heart at head office due to many different factors.
Same with Phelps Dodge, who FQM bought Kansanshi off. Their economies for the project were on a different scale to FQMs. Sorry, cant remember their figure for developing Kansanshi, but it was hugely more than FQMs. No need or room to be a bit canny. Also, Kans will be open pit, much less to go wrong. Meanwhile, Lonshi will soon be a fantastic cash cow, even at current copper prices.

[premiership2002] 23/8/2002 18:42

ASHLEY I HAVE INCLUDED YOUR SELECTION

[rolandp] 23/8/2002 18:37

..thought someone might have mentioned Anglos "exit price". Looked like 80 odd million reasons to stop mining copper there. Still, FQM is supposed to be lower cost so good luck.

[rambutan2] 23/8/2002 17:39

Have just read analyst reports from Canaccord and Jennings Capital, both published this month after recent trip over to the sites in Africa.
Cana 12 month price target C$6.50 and Jens of C$8. Today's close price was C$3.
Both were v impressed at what they saw and believe FQM much undervalued and the best leveraged play on copper on the mkt. FQM should be able to make money even at current low copper price, if and when the price spikes up it will be very very profitable.

Regards
Rambutan

[mr ashley james] 03/7/2002 16:10

Rambutan,

I will put it this way, Iwould far prefer to back FQM in Zambia indeed anywhere than Twigg Minerals.

FQM is holding up nicely, low profile steady riser.

I must go and catch up on copper.

Best regards

Ashley

[rambutan2] 22/6/2002 00:52

They keep the good news rolling...

FIRST QUANTUM REPORTS RESULTS FROM THE GRDMinproc ENGINEERING STUDY

ON THE KANSANSHI COPPER-GOLD DEPOSIT

- Updated Resource Calculation-

- Phase One Operating Estimates-



(All figures expressed in United States dollars)



First Quantum Minerals Ltd. (TSX Symbol "FM", LSE Symbol "FQM") is pleased to
announce the results of the Engineering Study ("the Study"), dated June 2002,
for Phase One development of First Quantum's 80% owned Kansanshi copper-gold
project. The Study was conducted and compiled by GRDMinproc Limited ("Minproc")
of Perth, Western Australia and will lead to a Definitive Feasibility Study
which is scheduled for completion in the fourth quarter of 2002. The Study
considers all aspects of the development of a new, large scale open pit mine at
Kansanshi. First Quantum's objective is to develop an operation that recognizes
the changing physical nature of the Kansanshi orebody with depth, and
consequently minimize capital and maximize profitability.



The Study envisions that the Kansanshi project will be developed in two phases.
Phase One development (years 1-11) will focus predominantly on shallow copper
oxide and mixed ores. During Phase One copper cathode from a SX/EW facility will
comprise approximately 60% of output, while copper in concentrate will account
for 40%. Copper in concentrate will be sent to existing Copperbelt smelters for
processing. The mineable resource for Phase One is 73 million tonnes grading
1.74% copper and 0.27g/t gold. Phase Two development (years 12-26+) will focus
on sulfide ores with a mineable resource, based on the Phelps Dodge
Pre-feasibility Study, of 197 million tonnes grading 1.16% copper and 0.12g/t
gold. The Company anticipates that, subject to certain conditions, initial
construction for Phase One including civil engineering and some earthworks could
commence late in 2002, with commissioning in November 2003 and commercial
production commencing in early 2004.

Minproc Resource Calculation

The resources tabulated below have been estimated by Minproc in accordance with
National Instrument 43-101, Standards Disclosure for Minerals Projects. Mr. Dan
Greig and Ms. Annick Manfrino, both employed by Minproc, are the qualified
persons responsible for the resource estimate in this release.


Cut-off Class Tonnes Copper Copper Gold Gold

(Mt) (%) (Blbs) (g/t) (ozs)
Cu(t) 0.5% Measured 93.2 1.43 2.94 0.19 569,000
Indicated 208.6 1.06 4.87 0.16 1,073,000
Inferred 111.0 1.11 2.72 0.12 428,000
Total Measured + Indicated 301.8 1.17 7.81 0.17 1,642,000

Cu(t) 1.0% Measured 48.4 2.09 2.23 0.25 389,000
Indicated 75.8 1.72 2.87 0.23 561,000
Inferred 41.2 1.81 1.64 0.14 186,000
Total Measured + Indicated 124.2 1.86 5.10 0.24 950,000






Minproc Phase One Operating Estimates (Years 1-11 only)

The following parameters have been estimated by Minproc for 100% interest of the
Kansanshi project:


Ore 73 Mt grading 1.74% Cu & 0.27g/t Au containing 1.037Mt
(2.29 billion pounds) recoverable copper and 0.46 Moz
recoverable gold
Strip Ratio 2 ; 1
Plant Throughput 6.6 Mtpa
Metallurgical Recovery 82% copper, 73% gold
Total Cathode Copper Production 624,000 t (1.4 billion pounds)
Total Copper in Concentrate Production 413,000 t (0.9 billion pounds)
Average Annual Copper Production 94,286 t (0.2 billion pounds)
Total Gold Production 460,000 oz
Average Annual Gold Production 41,800 oz
Pre-Production Capital Cost $155 million
Operating Cost $12.90 /t ore treated
C1 (Cash) Cost, net of credits $0.35/lb



"We are very pleased with the outcome of the GRDMinproc Engineering Study which
demonstrates that the potential for the Kansanshi deposit, which hosts an insitu
resource, assuming a 0.5% Cu(t) cut-off, of 7.8 billion pounds copper and 2.0
million ounces gold to be developed as a large, low cost copper producer. We
look forward to working with the Government of the Republic of Zambia, in a
joint effort to expedite the construction of Kansanshi. First Quantum Minerals
is a committed long term investor in Zambia and we believe that the development
of new low cost copper deposits will play an increasingly important role in the
future of Zambia's copper industry." commented Philip Pascall, Chairman and CEO.

[mr ashley james] 10/6/2002 22:15

Rambutan,

FQM has now broken out at long last, through 185p resistance.

I see both ANTO and FQM going very nicely thank you.

Best regards

Ashley

[rambutan2] 10/6/2002 18:32

Well, unlike some, my favourite mining company that doesn't seem to have a problem getting financing from the banks!


First Quantum Min - US$18 Million Debt Facility
RNS Number:0229X
First Quantum Minerals Ld
10 June 2002


NEWS RELEASE
02-08
June 10, 2002
www.first-quantum.com


FIRST QUANTUM COMPLETES US$18 MILLION LOAN FACILITY FOR BWANA MKUBWA EXPANSION


First Quantum Minerals Ltd. (TSE Symbol "FM", LSE Symbol "FQM") is pleased to
announce the signing of a US $18 million term debt facility for its wholly owned
subsidiary Bwana Mkubwa Mining Limited ("Bwana Mkubwa") with Standard Chartered
Bank ("SCB"). The facility will consist of a US $15 million facility and a
Zambian Kwacha 12.50 billion facility (US $3.0 million) provided by Standard
Chartered Bank, Zambia. The facility will be used to finance the expansion of
the SX/EW plant at Bwana Mkubwa from an annual production rate of 10,000 tonnes
(22 million pounds) of copper cathode to a minimum of 30,000 tonnes (66 million
pounds) of copper cathode. The SCB facility is repayable in 36 equal monthly
installments commencing in November, 2002 after the scheduled completion of the
Bwana Mkubwa expansion.

"The SCB loan facility completes all of the financing required to triple copper
production at Bwana Mkubwa and demonstrates strong support from the
international banking community for this unique cross border operation. Phase
Two of the expansion construction is well underway and we expect commissioning
to begin early in the fourth quarter of 2002. When the Bwana Mkubwa facility is
fully expanded to treat ore from the Lonshi deposit, cash costs net of credits
are budgeted to be $0.30 per pound of copper putting the Bwana Mkubwa operation
in the lowest quartile worldwide in terms of cost of production. Bwana Mkubwa
will continue to be a cornerstone of the company and a major contributor to cash
flow. " commented Philip Pascall, Chairman, First Quantum Minerals.

The Lonshi copper deposit is located 36 kilometres southeast of the Bwana Mkubwa
facility in the Democratic Republic of the Congo. The current resource is 5.1
million tonnes grading 5.75% copper or 295,000 tonnes (650 million pounds) of
contained copper. In September 2001, the Company commenced open pit mining
operations at Lonshi. As of April 27, 2002 approximately 563,000 tonnes of ore
grading 4.5% acid soluble copper containing 25,300 tonnes (56 million pounds) of
copper had been stockpiled for future processing. Exploration drilling to test
both the strike extension and down dip extension, between 65 metres and 140
metres, of the Lonshi orebody, has been very encouraging and detailed results
will be published upon compilation and analysis of data.

On Behalf of the Board of Directors 12g3-2b-82-4461
of First Quantum Minerals Ltd. Listed in Standard and Poor's
"G. Clive Newall" Sedar Profile £00006237
G. Clive Newall
President

[mr ashley james] 06/6/2002 00:10

Clive,

Nice break out well done.

Best regards

Ashley

[rambutan2] 30/5/2002 14:23

Announcement below reason for nice rise today?
Plus, while doubts about recovery of other base metals later this year/next, most analysts still seem pretty positive on copper.


BHP Billiton copper output cuts a positive move - Salomon Smith Barney

Thu 30 May 2002

SYDNEY (AFX) - Salomon Smith Barney said BHP Billiton Ltd's decision earleir this week to cut back copper production this year by an additional 80,000 tonnes will result in "more value" as a result of increased copper prices.
In a research note, analysts Ian Maxwell and Alan Heap said that following BHP Billiton's announcement speculative activity drove copper prices sharply higher, and the move may encourage other producers to maintain their cutbacks.
"We estimate that BHP Billiton's decision to cut back production has been
value enhancing and is a good management decision," they said.
BHP Billiton's decision to cut production was in response to weakness in demand for copper. The company in November announced it would cut back production by 170,000 tonnes through to end-2002.
The analysts noted that changes in the copper price since the first announcement can be directly attributed to BHP Billiton's decision to cut output.
"This appears to be true for the early November cutback decision, which drove short covering and a sharp appreciation in the copper price," they said.
"We expect prices to pick up in the second half of 2002, as global international production accelerates, but the timing of the recovery may be later in the period."
Copper producers worldwide are expected to cut output by 700,000 tonnes this year, the analaysts said.
Reduced mine production, together with further tightening in the concentrate market, is expected to reduce refined production by around 5 pct in 2002, they added.
At 3.16 pm BHP Billiton shares were up 0.14 aud, or 1.28 pct, at 11.04.
The S&P/ASX 200 was up 6.4 points at 3387.6.