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Zambia power cuts push First Quantum closer to downgrade -Moody's

Published 2015-08-03, 08:38 a/m
Zambia power cuts push First Quantum closer to downgrade -Moody's
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LONDON, Aug 3 (Reuters) - Power cuts in Zambia, coupled with
falling copper prices, are increasing the risk of a credit
rating downgrade at copper producer First Quantum FM.TO ,
Moody's said on Monday.
Moody's, which has a negative outlook on its B1 rating for
Canada's First Quantum, said that "credit metrics may
deteriorate more sharply than anticipated in the next 12 months,
towards levels not commensurate with the current rating."
Power cuts in north-western Zambia have affected production
at mines run by First Quantum and other producers. The mining
firm said it will lay off about 1,480 workers at one of its
Zambian copper projects after the reduction in power supply
curbed production. ID:nL5N10D0II
First Quantum's problems were compounded by a fall in copper
prices -- down about 18 percent so far this year -- that is
denting its revenue at a time of mounting financial pressure for
the company, which is consuming cash as its develops its large,
open pit Cobre Panama project, Moody's said.

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