Freeport shares drop after warning that recovery at the Grasberg Mine will be slow following a deadly incident

Miner Freeport-McMoRan said on ?Thursday it expects a slower-than-anticipated recovery at ?its flagship Grasberg mine ?in Indonesia after ?a ?fatal mud flooding incident disrupted operations.

In premarket trading, shares of the company dropped by more than 9%.

The company expects that only 65% of the production at Grasberg - the world's 2nd largest copper?mine - will be restored in the second half of this year. This is down from the 85% it had predicted earlier.

The largest publicly traded 'copper producer in the world' expects to produce 800 millions pounds of copper this year and?700,000,000 ounces gold.

The estimated amount of copper cathode was 1.1 billion pounds and the gold equivalent to 800 million ounces.

Freeport's copper output fell by 23.7% in the first quarter to 662 millions recoverable pounds, while gold production dropped by 66.2% to 97,000 recoverable ounces.

The stronger copper price helped to offset the impact of lower volume.

Copper prices increased 36.7% on average during the quarter of January-March, due to supply constraints, low inventories and robust demand.

Freeport reported that its realized copper price was $5.78 per pound. This is up from $4.44 one year earlier.

Prices were higher than expected, helping Freeport to beat Wall Street's quarterly profit estimates.

According to LSEG data, the company reported an adjusted loss of 57 cents for the three-month period ended March 31, compared to analysts' average estimates of 46 cents.

(source: Reuters)