Nexa | Guidance 2022-2024
Guidance is based on several assumptions and estimates, including but not limited to metal prices, operational performance, grades, maintenance, input costs, exchange rates, political and social situation, and proactive protocols to mitigate the spread of COVID-19 in all our operations and projects.
Mining segment
Main products
| Metal contained (in concentrate) |
2022e | 2023e | 2024e | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Zinc | kt | 287 | – | 318 | 330 | – | 375 | 331 | – | 383 | ||||
| Cerro Lindo | 81 | – | 86 | 68 | – | 80 | 75 | – | 82 | |||||
| El Porvenir | 49 | – | 53 | 54 | – | 63 | 34 | – | 42 | |||||
| Atacocha | 8.5 | – | 9.4 | 9.2 | – | 10 | 13 | – | 19 | |||||
| Vazante | 118 | – | 127 | 130 | – | 144 | 131 | – | 143 | |||||
| Morro Agudo | 16 | – | 19 | 19 | – | 21 | 17 | – | 20 | |||||
| Aripuanã | 14 | – | 23 | 51 | – | 56 | 60 | – | 77 | |||||
| Copper | kt | 28 | – | 35 | 37 | – | 40 | 35 | – | 37 | ||||
| Cerro Lindo | 26 | – | 33 | 31 | – | 32 | 30 | – | 32 | |||||
| El Porvenir | 0.3 | – | 0.3 | 0.4 | – | 0.4 | 0.3 | – | 0.4 | |||||
| Aripuanã | 1.6 | – | 2.3 | 5.4 | – | 6.9 | 4.2 | – | 4.4 | |||||
| Lead | kt | 46 | – | 55 | 63 | – | 71 | 46 | – | 58 | ||||
| Cerro Lindo | 11 | – | 12 | 7.6 | – | 10 | 10 | – | 11 | |||||
| El Porvenir | 15 | – | 18 | 19 | – | 22 | 6.6 | – | 10 | |||||
| Atacocha | 10 | – | 11 | 11 | – | 12 | 4.7 | – | 6.8 | |||||
| Vazante | 1.0 | – | 1.2 | 1.3 | – | 1.5 | 1.2 | – | 1.6 | |||||
| Morro Agudo | 4.3 | – | 4.8 | 5.8 | – | 6.4 | 4.3 | – | 5.0 | |||||
| Aripuanã | 5.0 | – | 7.7 | 19 | – | 20 | 19 | – | 24 | |||||
| Silver | MMoz | 8.6 | – | 10 | 10 | – | 11 | 7.8 | – | 9.4 | ||||
| Cerro Lindo | 3.9 | – | 4.1 | 3.3 | – | 3.7 | 3.9 | – | 4.0 | |||||
| El Porvenir | 3.1 | – | 3.6 | 3.3 | – | 3.9 | 1.3 | – | 2.4 | |||||
| Atacocha | 1.0 | – | 1.1 | 1.0 | – | 1.1 | 0.5 | – | 0.7 | |||||
| Vazante | 0.3 | – | 0.4 | 0.3 | – | 0.5 | 0.3 | – | 0.5 | |||||
| Aripuanã | 0.3 | – | 0.5 | 1.5 | – | 1.7 | 1.7 | – | 1.8 | |||||
| Smelting sales | 2022e | 2023e | 2024e | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Metal | kt | 565 | – | 590 | 580 | – | 605 | 580 | – | 605 | |||
| Zinc metal | 528 | – | 551 | 542 | – | 565 | 542 | – | 565 | ||||
| Zinc oxide | 37 | – | 39 | 38 | – | 40 | 38 | – | 40 | ||||
2022 Cash costs
Cash costs for 2022 are based on several assumptions, including but not limited to:
- Production volumes;
- Commodity prices (Zn: US$1.36/lb, Cu: US$4.22/lb, Pb: US$1.00/lb, Ag: US$25.2/oz, Au: US$1,799/oz);
- Foreign exchange rates (BRL/USD: 5.50 and Soles/USD: 4.02); and
- 2022 zinc treatment charges (“TCs”) of US$230/t concentrate.
| Cash Cost (US$/lb) |
2022e | |
|---|---|---|
| Mining Cash Cost ¹ | 0.28 | |
| Cerro Lindo | (0.26) | |
| El Porvenir | 0.39 | |
| Atacocha | (0.03) | |
| Vazante | 0.55 | |
| Morro Agudo | 0.94 | |
| Smelting Cash Cost¹ | 1.37 | |
| Cajamarquilla | 1.34 | |
| Três Marias | 1.38 | |
| Juiz de Fora | 1.44 |
¹C1 Weighted Cash cost net of by-products credits is measured with respect to zinc sold per mine.
²C1 Weighted Cash cost net of by-products credits is measured with respect to zinc sold per smelter.
- Mining: In 2022, consolidated mining cash cost is expected to increase year-over-year primarily due to inflationary pressures impacting third-party services, logistics, and consumable costs; which should be partially offset by higher by-product credits primarily in our Peruvian mines and costs reductions and operational efficiency initiatives.
- Smelting: In 2022, consolidated smelting cash costs are expected to increase year-over-year primarily due to inflation and higher energy costs, which should be partially offset by higher by-product credits.
2022 CAPEX
In 2022, CAPEX guidance is US$385 million and reflects inflationary cost pressures on several inputs such as third-party contracts, equipment, and logistics, among others.
The total estimated CAPEX for the Aripuanã project has been revised from US$575-595 million to US$625 million. We estimate a final implementation investment of US$59 million in 2022.
Sustaining investments are expected to total US$256 million, with smelting accounting for approximately US$75 million and mining accounting for US$180 million, including US$42 million from Aripuanã. Health, safety and environmental (“HSE”) expenses are forecasted to US$36 million.
| CAPEX (US$ million) |
2022 Guidance | |||
|---|---|---|---|---|
| Expansion projects | 75 | |||
| Aripuanã | 59 | |||
| Others¹ | 16 | |||
| Non Expansion | 310 | |||
| Sustaining (2) | 256 | |||
| HSE | 36 | |||
| Others (3) | 18 | |||
| TOTAL | 385 |
¹Including Magistral and Bonsucesso FEL3 studies, Vazante deepening and Aripuanã.
²Investments in tailing dams are included in sustaining expenses.
³Modernization, IT and others.
2022 Exploration & Project Evaluation and Other Expenses
| Other operating expenses (US$ million) |
2022 Guidance | ||||||
|---|---|---|---|---|---|---|---|
| Exploration | 64 | ||||||
| Mineral exploration | 43 | ||||||
| Mineral rights | 8 | ||||||
| Sustaining (mine development) | 13 | ||||||
| Project Evaluation | 18 | ||||||
| Exploration & Project Evaluation | 82 | ||||||
| Other | 18 | ||||||
| Technology | 12 | ||||||
| Communities | 5 | ||||||
Note: Exploration and project evaluation expenses consider several stages of development, from mineral potential definition, R&D, and subsequent scoping and pre-feasibility studies (FEL1 and FEL2).
In 2022, we plan to invest US$64 million in exploration. Our exploration expense guidance of US$43 million relates mainly to greenfield projects on exploration phase and brownfield projects, which are the exploration of orebody targets at our operations. Our project evaluation expense guidance of US$18 million includes projects from both mining and smelting segments, in FEL1 & FEL2 stages. In addition, we expect to invest US$12 million to improve our current operations and US$5 million to continue contributing to the social and economic development of our host communities.