Noranda Income Fund Provides Production Update; Revises 2022 Production Target
April 08 2022 - 5:05PM
Noranda Income Fund (TSX:NIF.UN) (the “Fund”) announced today that
operational challenges at its electrolytic zinc processing facility
(the “Processing Facility”) in Salaberry-de-Valleyfield, Quebec,
have negatively impacted zinc production and sales in the first
quarter ended March 31, 2022, resulting in a revision in its annual
production and sales target.
“A tight labour market and increased
COVID-related absenteeism, coupled with cold weather impacting
maintenance activities and resulting in a record number of
electricity curtailments, have exacerbated ongoing operational
challenges in the Electrolytic Hall. Despite the team’s best
efforts, this has resulted in a deterioration in production quality
and volumes in the first quarter of 2022,” said Paul Einarson,
Chief Executive Officer of CEZinc, the Fund’s Manager.
“The Processing Facility team continues to work
diligently to stabilize operations and has realized progress in
improving operating conditions, a careful and gradual process given
the complexity of smelting operations. In what remains a complex
environment, achieving operational reliability improvements will be
critical. We look forward to benefitting from our strategic
expansion projects once these operational challenges are fully
resolved,” added Mr. Einarson.
Zinc metal production in the first quarter of
2022 is expected to be 57,588 tonnes, compared to 66,345 tonnes in
the first quarter of 2021. Zinc metal sales are expected to be
56,826 tonnes, compared to 66,277 tonnes in the first quarter of
2021. As a result, the Fund is revising its annual production and
sales target to between 255,000 and 265,000 tonnes of zinc, from
its previously disclosed target of between 270,000 to 280,000
tonnes for 2022.
The Fund expects to complete the commission of
its strategic expansion projects, comprised of the installation of
additional belt filters and related equipment to increase the
Processing Facility’s filtration capacity, and two additional
cooling towers in the cell house to improve cooling capacity in the
summer months, in the second quarter of 2022.
2022 First Quarter ResultsThe Fund expects to
report its financial and operational results for the first quarter
ended March 31, 2022 on or around April 28, 2022.
About Noranda Income Fund
Noranda Income Fund is an income trust whose
units trade on the Toronto Stock Exchange under the symbol
“NIF.UN”. Noranda Income Fund owns the electrolytic zinc processing
facility and ancillary assets (the “Processing Facility”) located
in Salaberry-de-Valleyfield, Quebec. The Processing Facility is the
second-largest zinc processing facility in North America and the
largest zinc processing facility in eastern North America, where
the majority of zinc customers are located. It produces refined
zinc metal and various by-products from sourced zinc concentrates.
The Processing Facility is operated and managed by Canadian
Electrolytic Zinc Limited, a wholly-owned subsidiary of Glencore
Canada Corporation. Further information about Noranda Income Fund
can be found at www.norandaincomefund.com
Forward-looking
InformationCertain information in this press release,
including statements regarding the Fund’s production and sales,
future business plans and operation of the Processing Facility,
future liabilities and obligations of the Fund (including capital
expenditures), the ability of the Fund to operate profitably, the
dependence upon the continuing supply of zinc concentrates and
competition relating thereto, the ability of the Processing
Facility to treat a more varied feed quality stream, anticipated
trends in zinc concentrate supply and demand, smelting capacity,
sulphuric acid market demand and supply, zinc concentrate treatment
charges, the anticipated financial and operating results of the
Fund, distributions to Unitholders, the scope, timing and
completion of the Expansion Projects, the impact of the Expansion
Projects on the operations of the Processing Facility, the
operating and financial results of the Fund, and the impact of the
amendments to the SPA, the Operating and Management Agreement, the
Management Services Agreement, the Administration Agreement and the
agreements relating to purchases of zinc concentrate and sale of
zinc metal are forward-looking information. In some cases, but not
necessarily in all cases, forward-looking information can be
identified by the use of forward-looking terminology such as
"plans", "targets", "expects" or "does not expect", "is expected",
"an opportunity exists", "is positioned", "estimates", "intends",
"assumes", "anticipates" or "does not anticipate" or "believes", or
variations of such words and phrases or state that certain actions,
events or results "may", "could", "would", "might", "will" or "will
be taken", "occur" or "be achieved". Statements containing
forward-looking information are not historical facts but instead
represent management's expectations, estimates and projections
regarding future events.
Forward-looking information is necessarily based
on a number of opinions, assumptions and estimates that, while
considered reasonable as of the date of this press release, are
subject to known and unknown risks, uncertainties, assumptions and
other factors that may cause the actual results, level of activity,
performance or achievements to be materially different from those
expressed or implied by such forward-looking information, including
but not limited to the factors described in greater detail in the
"Risk Factors" section of the Fund’s Annual Information Form dated
March 30, 2022 for the year ended December 31, 2021 and the Fund’s
other periodic filings available at www.sedar.com. These factors
are not intended to represent a complete list of the factors that
could affect the Fund; however, these factors should be considered
carefully. There can be no assurance that such estimates and
assumptions will prove to be correct. The forward-looking
statements contained in this press release are made as of the date
of this press release, and the Fund expressly disclaims any
obligation to update or alter statements containing any
forward-looking information, or the factors or assumptions
underlying them, whether as a result of new information, future
events or otherwise, except as required by law.
For more information: |
Paul EinarsonChief Executive Officer of Canadian Electrolytic Zinc
Limited, Noranda Income Fund’s ManagerTel.:
514-745-9380info@norandaincomefund.com |
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