Production of between 940 and 1,030 kt is expected for FY2021, with a decline in copper grade of concentrator feed of approximately 4 per cent. Lower volumes reflect the need to continue to balance mine development and production requirements, with processing capacity at concentrators and leaching plants, as a result of a reduced operational workforce due to COVID-19. It is expected that production levels are likely to be impacted in FY2022 as a result of reduced operational workforce and material movement in FY2021. Guidance of an annual average of 1,200 kt of copper production over the next five years remains unchanged.
The BHP Operating System deployment and automated truck trial initiatives are expected to be completed in FY2021. In addition, Escondida will be undertaking studies on different material handling technologies to build an integrated suite of material handling projects that aims to combine innovative and disruptive technology and equipment solutions to increase mine productivity and improve costs competitiveness.
We expect these initiatives will allow Escondida to operate with a medium-term unit cost of less than US$1.10 per pound despite the continuation of grade decline and the increasing water costs.