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MAGMA COPPER COMMENTS ON CHILEAN JOINT VENTURE WITH BHP MINERALS; ANNOUNCES SECOND QUARTER EARNINGS AFFECTED BY FIRST QUARTER RAINS

 TUCSON, Ariz., June 22 /PRNewswire/ -- Magma Copper Co. (NYSE: MCU) reported today in a joint announcement with BHP Minerals that they have formed a joint venture to consider submission of a bid for an interest in the El Abra copper project in Northern Chile.
 J. Burgess Winter, Magma's president and chief executive officer, said, "We are very excited about this strategic partnership. BHP Minerals is a world leader in exploration and mining of high-quality mineral reserves and, as 57.5 percent owner of Escondida, their experience with the construction and operation of large Chilean mining operations is extensive. Magma's turnaround since 1988 has provided increased productivity and production and a $0.12 decrease in net cash operating cost per pound. This was achieved primarily through successful implementation of innovative labor management policies and improvements in SX-EW technology. These trends have increased our competitiveness and now provide us with opportunities to expand internationally. The El Abra joint venture and bid represent a significant step towards our goal of expanding into major international, high-grade mining operations."
 The joint venture brings together a unique combination of management, operating and technical strengths and expertise in leaching, solvent extraction-electrowinning (SX-EW) operations.
 Codelco, the world's largest copper mining company, is soliciting bids for an interest in this property. Bids are due by the end of August and a decision is expected by the end of 1993. Preliminary studies commissioned by Codelco indicate that the total project could produce 265 million pounds of copper per year using low-cost oxide leaching/SX-EW methods.
 Second Quarter Earnings Negatively Impacted by First Quarter Rains
 Magma's earnings for the second quarter of 1993 will be negatively impacted by residual operating effects caused by extraordinary rains in the first quarter. Winter commented that the company estimates fully diluted earnings per share to be between $0.08 and $0.11 for the quarter ending June 30, 1993.
 As previously mentioned in the company's release of first-quarter earnings, the Pinto Valley Mining Division temporarily altered its mine plan due to flooding in a higher-grade area of its open-pit mine. While lower ore grades and production from this division during April and May will impact second-quarter 1993 after-tax earnings by approximately $0.05 to $0.06 per share, production has returned to normal levels in June. The net effect of several other unrelated items will negatively impact earnings for the quarter by another $0.02 to $0.03 per share.
 The average LME copper price for second quarter 1993 is approximately $0.84 per pound. However, Magma will realize approximately $0.93 per pound of Magma source copper sold due to the 1992 purchase of LME copper puts covering 1993 production.
 Robinson Project Delayed 12 to 18 Months for EIS
 On an unrelated matter, the company announced on June 15 that the Nevada Bureau of Land Management (BLM) will conduct an environmental impact statement (EIS) to analyze the proposed re-development of the company's Robinson property near Ely, Nev. Although management believes the required permits will be received, they estimate that the EIS will delay the project between 12 to 18 months, pushing first production into the first half of 1996.
 Magma Copper Co., one of the largest primary copper producers in the United States, produces high-quality copper cathode and rod for sale to customers worldwide. Magma has operations in San Manuel, Miami, Superior, Ariz. and Ely. Magma Metals Co., a wholly owned subsidiary, operates Magma's smelting and refining complex, located in San Manuel, and conducts the company's marketing and sales activities. Corporate headquarters are in Tucson.
 -0- 6/22/93
 /CONTACT: Richard P. Johnson, 602-575-5670, or Kimberly L. Wick, 602-575-5673, both of Magma Copper/
 (MCU)


CO: Magma Copper Co.; BHP Minerals ST: Arizona IN: MNG SU: JVN ERP

JL-BP -- SD003 -- 4375 06/22/93 08:20 EDT
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Publication:PR Newswire
Date:Jun 22, 1993
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