Remote working the ‘new normal’, says OZ Minerals
OZ Minerals boss Andrew Cole says remote working will be the company’s new normal.
OZ Minerals boss Andrew Cole says remote working will be the company’s new normal even after the threat of coronavirus recedes, pointing out that productivity gains from its work-from-home pandemic policies had helped the company to a strong June quarter performance.
OZ Minerals shares hit levels not seen since the heights of the mining boom in 2011 after delivering a strong set of results on Wednesday, upgrading production guidance at its Prominent Hill mine and its new Carrapateena operations, and saying the ramp-up of the deep underground mine was now tracking ahead of schedule.
The company said it now expects to produce between 88,000 and 105,000 tonnes of copper this year, up about 5 per cent from prior guidance of 83,000- 100,000 tonnes. It also expects to produce 227,000-249,000 troy ounces of gold, above a prior forecast for 207,000-234,000 ounces.
OZ Minerals produced 24,577 tonnes of copper in the June quarter, up sharply from output of 20,231 in the first three months of the year, as the ramp-up of Carrapateena gathers pace. The new mine produced 7170 tonnes of copper in the period, and OZ Minerals lifted its annual guidance for the mine by 5000 tonnes to 25,000-30,000 tonnes.
Copper prices climbed above $US6500 a tonne in recent weeks, the highest levels since mid-2018 as the coronavirus pandemic threatened supply from major copper mines in South America.
But the impact of the pandemic has been relatively minimal at OZ Minerals’ Australian operations, and Mr Cole told The Australian the company intended to use what it had learned from the pandemic to begin to “normalise” remote working practices.
“We could all come back into the office and start working as we did pre-COVID, but we’ve actually found productivity and engagement improvement as a result of baking in some of the leanings,” he said.
“So we’ve asked everybody in the company to develop work-life plans which helps them think about how they would like to work and how they’re most productive — and it’s been a really fruitful exercise.”
Mr Cole said the initiative was not about saving money, and he had set no targets for the number of staff working from home. Instead the company’s Project Beyond was aimed at helping staff work wherever and however they believed they would be most productive.
“I’m personally only coming into the office once a week, plus or minus, and I work from home or other locations depending on who I’m talking to or meeting with. But it means my focus when I come into the office is not to sit at my desk or in meetings, it’s to come and talk to people,” he said.
As copper prices rise and production lifts, OZ Minerals has hit a sweet spot with the market, with its shares climbing 55c to close up 4.3 per cent at $13.53 on Wednesday, its highest levels since 2011.
And Mr Cole said concerns hanging over output from major South American mines would underscore existing supply issues in the copper market.
“Prior to the pandemic the supply side had downward pressure on it anyway, because of the natural evolution of these older ore bodies. The discovery rate has been low for the last decade, and there’s a lack of a pipeline,” he said.
“You put on top of that the restrictions to protect people’s health and wellbeing, that’s adding to the supply pressure we’re going to see over the medium term and long term.”
But copper’s July resurgence came after commodity prices hit lows of around $US4600 a tonne in March, on fears slowing economic growth due to the pandemic would dent demand for copper, and Mr Cole said he believed prices would remain volatile in the near term.
“On the demand side copper is one of the very few commodities that are needed for everything — construction, or white goods consumption, or electric vehicles, or telecommunications. So I still think demand is going to be robust, but it might have some downward pressure given concerns in different countries,” he said.
“I’m sure there will be tremendous volatility as countries pivot and move. We’re already seeing stimulus packages … and every stimulus package requires the consumption of copper in some way shape or form.”
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