Thank you for standing by, and welcome to the MMG Limited Fourth Quarter Production Report Teleconference. All participants are in a listen-only mode. There will be a presentation, followed by a question-and-answer session. If you wish to ask a question, you'll need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Jarod Esam, Head of Investor Relations. Please go ahead.
Hello, and welcome to MMG's quarterly production report teleconference. This report and today's discussion cover the operational performance of MMG sites for the fourth quarter of 2023 and the outlook for 2024. Joining us today are MMG Interim CEO, Mr. Li Liangang, and CFO, Mr. Ross Carroll, together with other exco members. I'll now hand over to Liangang, who will discuss the highlights in the report before we provide an opportunity to ask questions.
Thank you, Jarod. Good morning to everyone, and welcome to MMG's fourth quarter production report teleconference. As always, safety comes first. Our total recordable injury frequency for the fourth quarter is 1.13 per million hours worked, and 1.97 for the full year of 2023. The result was a significant improvement compared to the previous quarter, with all sites demonstrating better execution of safety control. Safety is our top priority and fundamental to our success, and we remain committed to continuously improving our safety performance. Now, let's turn to our production performance for fourth quarter and the 2023 full year results. MMG finished the year with a strong fourth quarter. All MMG operations met or outperformed the latest production and CY guidance.
In 2023, we produced more than 347,000 tonnes of copper and 203,000 tonnes of zinc. This was a 14% increase and a 9% decrease, respectively, compared to 2022. Las Bambas produced around 81,000 tonnes of copper in the fourth quarter, which was 11% higher than the same period in 2022. A number of operational improvements, including optimization of the third ball mill, contributed to a record high quarterly mill throughput of around 14 million tonnes and the highest quarterly recovery rate since 2021. In 2023, Las Bambas produced around 302,000 tonnes of copper towards the top end of the latest guidance, marking the 19% increase compared to 2022.
Annual mill throughput reached a record high of around 53 million tonnes, a 20% increase compared to 2022. The strong performance was driven by mostly uninterrupted operations in 2023 and the operation of the third ball mill. The full year C1 costs also performed the latest guidance at $1.60 per pound, mainly due to favorable metal prices, higher production, and an increase in capitalized mine development. I also want to provide an update on community engagement and transport logistics. MMG remains committed to transparent and constructive dialogues with the government of Peru and the community members. We have made progress in discussions with the Huancuire community, with five contracts signed with community companies. These companies have begun early works at Chalcobamba.
The Las Bambas team is working with the Huancuire community towards enduring agreements for the development of Chalcobamba deposit. Since the removal of roadblocks in March, Las Bambas concentrate transport has been stable, aided by the government's declared state of emergency. Total sales of the year reached 1.1 million tonnes of concentrate, the second highest annual sales volume since the commissioning of Las Bambas. Looking ahead to 2024, we anticipate Las Bambas copper production to be between 280,000 and 320,000 tonnes, which is a similar level to 2023, but subject to the timing of the Chalcobamba development. C1 costs for 2024 are expected to range between $1.60-$1.80 per pound.
This represents an increase compared to 2023, due to higher volume driven costs and lower anticipated by-product credits. Moving on to Kinsevere. The mine produced approximately 10,000 tonnes of copper cathode in the fourth quarter of 2023, marking an 18% decrease compared to the same period in 2022. This was driven by a decline in the feed grade, resulting from a higher proportion of lower grade stockpiles after the depletion of the high grade oxide ores in the main Kinsevere oxide pit, as well as reduced consumption of high-cost third-party ore. I'm pleased to report that the Kinsevere Cobalt plant was commissioned in the fourth quarter, producing 105 tonnes of cobalt contained in cobalt hydroxide.
For the full year of 2023, Kinsevere's production of around 44,000 tonnes was in line with the latest guidance, but 10% lower than the previous year. This reduction can be attributed to a lower annual mill throughput due to an unstable power supply from the national grid, as well as a lower ore feed grade. The C1 costs for the full year were $3.29 per pound, aligning with the latest guidance. Now let me provide an update on the Kinsevere expansion project. The construction of the project and the transition to mining and processing of sulfide ore remain on track. A new tailings storage facility was commissioned to support the ramp-up of the cobalt plant. Construction of the sulfide processing system continued, with most civil work completed in the fourth quarter.
The site has started receiving and heavy equipment and materials, and mechanical and structural installation is underway. Moving forward, the focus will be on ramping up the cobalt plant, installation of the concentrator and the roaster, gas cleaning and acid plant and operational readiness-related work. The project will extend the mine life to at least 2035 and bring the annual production to approximately 80,000 tonnes of copper cathode and 4,000-6,000 tonnes of cobalt in cobalt hydroxide. We expect the first copper cathode from sulfide ore in the second half of 2024, and a full ramp-up in 2025. Looking into 2024, we expect Kinsevere copper cathode production to be between 39,000 and 44,000 tonnes.
This range reflects a decrease in oxide ore supply from the main pit as the focus shifts to sulfide, partly offset by an increase in the supply from Sokoroshe II . The C1 costs are anticipated to range from $2.80 to $3.15 per pound. This represents an improvement comparing to 2023, with byproduct credits from cobalt production and an increased supply of ore from Sokoroshe II , reducing the need for third-party ore. Looking beyond 2025, the combination of higher copper production and cobalt byproduct credits is expected to significantly reduce the mine's C1 costs. I will now move on to our Australian operations, Dugald River and Rosebery.
Dugald River produced around 47,000 tonnes of zinc and 7,000 tonnes of lead in the fourth quarter of 2023, an increase of 6% and 16% respectively, compared to the same period in 2022. The production growth was supported by strong performance in ore mined and milled, high grades and recovery rates, thanks to the stable operations since the ramp-up in the second quarter and continuous operational improvement. Full year zinc production of around 152,000 tonnes exceeded the prior guidance, supported by strong and stable operations in the fourth quarter. The annual recovery rate reached a record high of 89%, continuing the year-on-year upwards trend that has been achieved since the beginning of operations.
The full year C1 costs were $0.93 per pound, outperforming the revised guidance, driven by strong operational performance and lower treatment charges on spot sales. Regarding 2024, we expect the mine's production to be in the range of 175,000-190,000 tonnes of zinc in zinc concentrate, reflecting performance supported by stable operations and continuous operational improvement. C1 costs in 2024 are expected to be in the range of $0.70-$0.80 per pound. At Rosebery, the mine produced almost 17,000 tonnes of zinc in zinc concentrate and 6,000 tonnes of lead in lead concentrate in the fourth quarter, an increase of 5% and 24% respectively, compared to the same period in 2022.
This improvement was driven by higher volumes of ore mined and milled due to the mine sequence and increased recovery, supported by continuous operational improvements. Full-year zinc production of around 52,000 tonnes matched the revised guidance and exceeded the 2022 levels by 1%. Full year C1 costs of $0.26 per pound outperformed guidance, driven by the strong fourth quarter production and higher precious metals prices. Looking ahead to 2024, Rosebery expects zinc production to be in the range of 50,000-60,000 tonnes of zinc in zinc concentrate, showing improvement compared to 2023, mainly due to higher expected zinc grades, including the contribution of by-product metals. Zinc equivalent production for 2024 is expected to be in the range of 115,000-130,000 tonnes.
C1 costs for 2024 are expected to be in the range of $0.10-$0.20 per ton. This is an improvement on 2023 due to higher anticipated production levels and lower zinc treatment charges. I would like to brief, to briefly update on the acquisition of the Khoemacau mine in Botswana. On 20 November 2023, MMG announced that it entered into a share purchase agreement to acquire the Khoemacau mine in Botswana for $1.875 billion. The Khoemacau mine is a large-scale, long-life copper mine located in northwest Botswana in the emerging Kalahari Copper Belt.
On December 22, 2023, approval was received from the Ministry from the Minister of Minerals and Energy of Botswana for the transfer of a controlling interest in the production licenses and prospecting licenses linked to the Khoemacau Copper Mine. However, it is important to note that the acquisition is subject to the fulfillment of all waivers of certain other conditions and may or may not proceed to completion. To conclude, I would like to comment on recent changes on the composition of the executive committee. With effect from March 6, 2024, Ross Carroll will retire from his role as the CFO of MMG and will depart the company on July 1, 2024, following a transition period. I thank Ross for his significant contributions to the company over more than eight years.
On behalf of the entire MMG team, I wish Ross much success in his new chapter. Thank you, Ross. Additionally, from the first of February 2024, Song Qian will be appointed to the role of Executive General Manager of Finance. Song brings to the role significant executive experience with China Minmetals Corporation, and was most recently the CFO of Minm etals Innovation Investment Co., Limited. Prior to this role, he was the Vice President of Capital Markets of CMC from 2019 to 2022. Nan Wang, currently Executive General Manager, Australia and Africa, will be appointed to the role of Executive General Manager, Operations, and Troy Hey's responsibilities as Executive General Manager, Corporate Relations, will be expanded.
I'm confident that we have the right composition of skills and experience to ensure a successful integration of Khoemacau, as well as the operational performance and future growth of our business. Thank you, and we are now happy to take any questions.
Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you're on speakerphone, please pick up the handset to ask your question. Your first question comes from Jimmy Feng from Citi. Please go ahead.
Hi. Hi, thanks, Mr. Li, Ross, and Jarod, for the sharing. I have a few questions. My first question is regarding the production guidance for Las Bambas in 2024. So if we just simply analyze the fourth quarter, last November, October 2023, the full year production could exceed the upper band of production guidance in 2024. So want to check whether the guidance is relatively conservative or, or have we factored in any potential transportation disruptions in this guidance? I will ask the question one by one. So this is the first question. Thanks.
Yeah, thanks for the question, Jimmy. No, I wouldn't say that our guidance is conservative, and it actually includes a fairly significant contribution from Chalcobamba, where we are yet to have formal access to commence mining at the pit. So, yeah, it's certainly not a conservative estimate. I mean, we're very hopeful we'll get between 300,000 and 320,000 tonnes. But I think, as if you've been on recent calls, we are facing the dilemma of falling grades in the Ferrobamba pit, and that's where Chalcobamba becomes important to us, because it will contribute to higher grades.
Now, we do make an allowance for some disruptions or logistics, but we have enough surge capacity in the system, so if we do get a week or two stoppage, we're able to catch up. So, basically, our sales and production aren't curtailed by logistics disruptions at all.
Okay, got it. So, I want to further check the development of Chalcobamba. I think that the early works have been commenced. So does that mean the agreement has been reached with the Huancuire community? And how many volume contribution in 2024 from the Chalcobamba in the base case of production guidance?
Thanks, Jimmy. It at the moment, so we have been in negotiation, as you're aware, for some time. There were kind of three areas, the substantive ones around legal rights and water rights. There was a integration into the supply chain, so community contracts and businesses. And there was a third part, which was around compensation and benefits. So we've had, I think, good progress on the substantive. We're seeing the first of the five community contracts signed and underway. We've called them early works because they are the kind of preparatory works that are happening on the Chalcobamba site. The site is clear. We have access for community groups.
So our community companies are working well, but we're still to agree that final kind of compensation and benefits package, and still to really have what we'd call full access to start mining. But that is, as Ross said, we are very, very hopeful that we are very close. The signs are all very good in terms of the working relationship, the presence of the community companies on site, the excellent start-up and performance so far. And so, as Ross said, we've put guidance in that really looks from a commencement from February through to May, somewhere in that period. Early would be great. As we get later on, the guidance and the cost guidance both start to get a little bit more at the lower end.
But at the moment, good conversation, very good relationship with the communities, businesses working and on the ground, but still some work to do on a final comprehensive agreement that we would like to have, and I think the community would like to have, to mean we have uninterrupted and full access to do Chalcobamba.
Okay. Okay, got it. Thanks. Thanks. And I have a final question regarding Kinsevere. I also want to check how many volume contribution from the sulfide ores in 2024 have been factored in? And also we have seen a declining TCRC recently. I think for Kinsevere, it seems you need to purchase some third-party ores. So want to check whether the low TCRC will have an impact on the profitability. And do you have some long-term contracts for the TCRC and at which level for TCRC for Kinsevere?
Yeah, Jimmy, I'll probably talk about the TCRC. Because Kinsevere, we producing copper cathode. There's no TCRC sort of applied to copper cathode.
Oh, okay. Okay. Got it. Thanks for the answer, and that's very clear, and congratulate on the strong first quarter last on this operation. I have no further questions. Thanks.
Thank you. Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Chris Shiu from Balyasny Asset Management. Please go ahead.
Thank you very much, management team. So my question is, so regarding the acquisition of Khoemacau, so what is the expected timeline for that? And also, if that is included, how would the production, you know, volume guidance for the company as well as the CapEx would be affected? Thank you.
Hi, Chris, it's Ross. We expect to have Khoemacau wrapped up in the first quarter, so probably somewhere between the end of February and end of March. You know, at this stage, everything's moving in a promising direction, but as Liang said, there's always that risk that something could change. But as I said, at this stage, we're very confident. Now, as far as the volumes, I think Khoemacau produced between 50 and 60 thousand tonnes of copper this year. So that, you know, we're gonna have a fairly substantial benefit to it. But realistically, Khoemacau only becomes a material asset when we do the expansion, which will take it up to 130,000 tonnes.
So I think if you would see over this financial year, while it's only doing 50,000-60,000 tonnes, it's not really going to make a material difference to our financial results. Now, I think that the CapEx for the year will be in the $20 million-$30 million range, so that won't be overly significant either, so.
Got it. Yeah. So, without that additional CapEx for Kinsevere, how is the CapEx for 2024? What is the budget right now?
Yeah, we're still finalizing our budget, but as you'd imagine, the CapEx will be fairly significant because we've still got about $300 million to spend on the KEP project. Las Bambas will be up around the $400 million-$500 million mark, and then you're probably looking at sort of, you know, anywhere up to $50 million each for Dugald and Rosebery. So you're looking at a pretty significant number. And, you know, as has been the case with Las Bambas, we're still sort of catching up from sort of 2022 and early part 2023, where we weren't able to spend as much money as we really needed to at the time.
Got it. Understood. Thank you very much.
Thank you. There are no further questions at this time. I'll now hand the conference back to Mr. Li for closing remarks.
Yeah, thank you for your time. And, in case you have any further questions, please feel free to contact our investor relations and corporate affairs teams. And thank you again. Goodbye.
Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.