Iron ore production in 3Q12 was 83.9 million tonne, 4.2% higher than 2Q12 with gains in all mining sites. Over the last twelve month period ended on September 30, 2012, our iron ore output reached 317.4 million tonne.
At Carajás we have not been able to match last year’s performance. Production was 27.6 million tonne in 3Q12, slightly higher than 2Q12, but 10.5% below the same period last year. Issues with environmental permitting led to the continuation of mining in some older pits, which has entailed lower productivity, lower Fe content and higher costs.
Current performance is definitely not consistent with the high quality of our assets and corrective measures are underway.
the improvement in our application process for environmental licenses, we obtained a significant increase in the number of permits this year 52 until the end of September more than twice as many as last year. These involve various logistics, iron ore and manganese mining operations in Brazil and are critical to the continuation of our regular production activities.
Among them, the most important ones were the preliminary license for the Serra Sul S11D project and the operation license for the N5 South mine.
N5 South, with 1.025 billion metric tons of proven and probable reserves and an average Fe content of 67.1%, is expected to begin production by year-end. It is estimated to provide some 25% of the run-of-mine (ROM) ores to be extracted from Carajas in 2013, boosting quality while leading to lower operating costs.
The Southeastern System, which encompasses the Itabira, Mariana and Minas Centrais mining sites, had a good operational performance, producing 30.1 million tonne, 6.5% higher than 2Q12.
Production from Itabira was 12.2% higher on a quarterly basis due to complete recovery after the intense rainy season in the beginning of the year. Improvements in the crushing process of Minas Centrais allowed for a 7.1% quarter-onquarter increase and 2.8% year-on-year.
Output of the Southern System - Minas Itabirito, Vargem Grande and Paraopeba totaled 21.5 million tonne, showing the best performance for a third quarter since 3Q08, reflecting continuous improvements at Vargem Grande and the optimization of operations at Paraopeba. Production at Vargem Grande and Paraopeba expanded by 6.0% and 6.5%, respectively, on a quarter-on-quarter basis.
Output at Minas Itabirito remained stable, at 7.9 million tonne.
The Midwestern System - Urucum and Corumbá mining sites reached its highest quarterly figure, producing 1.9 million tonne in 3Q12. Production rose 37.0% on a quarter-over-quarter basis and 14.0% on a year-over-year basis, due to operational improvements in both Corumbá and Urucum.
Output from Corumbá showed a quarter-onquarter increase of 50.4%, recovering from the lower level of 2Q12, which was caused by a maintenance stoppage.
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