Prominent Hill miner OZ Minerals slammed for poor result Terry Burgess. THE share market punished OZ Minerals yesterday for delivering what managing director Terry Burgess labelled a "disappointing" quarterly result. The owner of South Australia's second biggest mine finished the day with a share price at $3.99, down 9 per cent. Two factors had taken their toll on the September quarter production, Mr Burgess said. First, OZ had decided to rehabilitate the shape of its Prominent Hill open-pit mine, Malu, after a landslip. Second, ore mined on the periphery of the pit was of lower grade than expected. But Mr Burgess was positive about the future even though this period, long flagged as the low point in the mine's life, was even worse than expected. The quarter should not be taken as indicating OZ would have to revise its outlook which has mining returning to the more lucrative core of the pit with higher grades and less waste rock to be stripped away. "There is no question that the core of the ore body has performed well," he said. I do not believe from what I've been told and what I've seen and the information that we've looked at that there will be a major downgrade in the reserve. Mr Burgess reported September quarter production of 17,390 tonnes of copper and 28,177 ounces of gold. OZ lowered its guidance on what it expects to produce this year to 70,000 to 75,000 tonnes of copper. In mid-September, it had said it was aiming for 82,000 to 88,000 tonnes. Gold guidance was steady at 120,000-130,000 ounces. OZ has been reining in costs to counterbalance the lower production. It has reduced staff numbers, restructured departments and decreased the number of flights into Prominent Hill in the state's far north. Mr Burgess said this process was ongoing and office-bound positions at Prominent Hill were being re-examined to determine whether these roles could be performed from Adelaide. Moving staff to Adelaide, where a larger office on Greenhill Rd has been opened, would directly cut fly in-fly out costs as well as reduce the burden of support services such as catering at the mine. "We've had some positive responses from staff who'd prefer to be able to go home every night and be with their families and friends," he said. On the positive side, Mr Burgess said exploration at Khamsin, near Carrapateena, was proceeding very well with encouraging intersections of good grade copper. Mr Burgess reaffirmed that Glencore had made no approach to OZ, despite reports it was mulling over a takeover bid.