FACTBOX-Mines and plants hurt by low prices, high costs
reuters.com
Thu Oct 30, 2008 7:30am EDT
Oct 30 (Reuters) - The global financial crisis and sharp falls in metals prices have forced several companies to abandon or put on hold their plans to bring new mines on-stream.
Some existing producers also have shut down or curtailed their output at mines and plants as high costs and low prices bite. Below are details of the major projects and facilities which have been affected in recent months, as well as other related news.
Oct 30 - Australian miner Kagara Ltd (KZL.AX: Quote, Profile, Research, Stock Buzz) cut its 2008/09 zinc production target by 12.5 percent, citing "difficult times" caused by the dramatic drop in the metal's price. The new forecast of 35,000 tonnes also places in doubt Kagara's ability to meet a longer-term annual target of 100,000 tonnes of zinc in about two years, a company spokesman said. The revised plans are designed to help reduce overall capital spending and will delay indefinitely final construction of the firm's Mungana zinc ore treatment plant.
Oct 30 - Kazakh copper producer Kazakhmys (KAZ.L: Quote, Profile, Research, Stock Buzz) said it may cut copper output next year due to lower projected spending arising from global financial instability.
Oct 30 - Chelyabinsk Zinc Plant (CHZNq.L: Quote, Profile, Research, Stock Buzz), Russia's largest zinc producer, will cut planned 2009 output to 150,000 tonnes due to the global financial crisis. The company produced 165,007 tonnes of zinc and alloys in 2007.
Oct 30 - Tin output from Indonesia's PT Timah (TINS.JK: Quote, Profile, Research, Stock Buzz) may be between 4-10 percent lower than initial targets due to falling prices. The firm may produce between 45,000-48,000 tonnes of refined tin this year, below an earlier target of 50,000 tonnes.
Oct 30 - Australian miner Mincor Resources Nl (MCR.AX: Quote, Profile, Research, Stock Buzz) said it expects its production of nickel ore to be in a 16,000-19,000 tonnes range in fiscal 2009, down from an original plan of 19,500-20,500 tonnes.
Oct 29 - Chile trimmed its 2008 copper output forecast for the second time since July, to 5.45 million tonnes, citing operational issues but not slumping prices. But limited financing due to the global credit crisis may delay or cancel some new projects, the executive vice-president of Chile's state-owned copper commission Cochilco said.
Oct 29 - The Doe Run Company, the largest U.S. lead producer, said it will close in the next week one of the two furnaces at its Herculaneum smelter in Missouri. It was unclear exactly how much production would be cut. Previously when the plant has had to turn one furnace off, its output rate was lowered to a monthly rate of about 10,500 tonnes, compared with its recent average of about 12,000 tonnes of lead a month.
Oct 29 - Newmont Mining Corp (NEM.N: Quote, Profile, Research, Stock Buzz) said its planned start-up of the Boddington gold-copper mine in Australia has been delayed several months and the company's share of costs will be about 20 percent higher than previously forecast. Start-up now expected in early to mid-2009. The company blamed the delay mainly on a tightening Australian labour market and continued industry-wide commodity cost inflation.
Oct 29 - Canadian mining company Baja Mining Corp (BAJ.TO: Quote, Profile, Research, Stock Buzz) said it had delayed construction activities at the Boleo polymetallic project in Mexico, citing the ongoing financial turmoil. However, certain activities will continue.
Oct 29 - French mining group Eramet (ERMT.PA: Quote, Profile, Research, Stock Buzz) said it would limit its nickel deliveries this year to 52,000 tonnes, versus a reported previous objective of 55,000 tonnes. Sales by the group's nickel business fell 29 percent, hit by the slide in prices as demand for stainless steel has declined.
Oct 29 - Sherritt International Corp (S.TO: Quote, Profile, Research, Stock Buzz) said it would suspend about C$270 million in capital contributions to expansion work at Moa nickel operations in Cuba and its Fort Saskatchewan nickel refinery. It will also launch a review of its Ambatovy nickel project in Madagascar to rethink schedules and try to reduce costs.
Oct 29 - Australian miner Mirabela Nickel (MNB.TO: Quote, Profile, Research, Stock Buzz) (MBN.AX: Quote, Profile, Research, Stock Buzz), which aims to start production at its Santa Rita mine in Brazil by mid-2009, said it had decided to halt further exploration because of cash constraints.
Oct 28 - Kazakhstan's Kazakhmys (KAZ.L: Quote, Profile, Research, Stock Buzz) said it had halted operations at three copper mines and stopped the Zhezkazgan copper smelter for maintenance. But an official said the company was not going to reduce full-year output below the 2007 level despite the output cuts.
Oct 28 - Canada's Breakwater Resources (BWR.TO: Quote, Profile, Research, Stock Buzz) said it had decided to temporarily suspend operations at both the Langlois polymetallic mine in Quebec and the Myra Falls zinc-copper-gold mine in British Columbia.
Oct 28 - Aluminium Corp of China Ltd (2600.HK: Quote, Profile, Research, Stock Buzz) (601600.SS: Quote, Profile, Research, Stock Buzz) said it would cut capital spending by at least 20 percent in 2009 due to weak aluminium demand.
Oct 28 - Rio Tinto (RIO.L: Quote, Profile, Research, Stock Buzz) (RIO.AX: Quote, Profile, Research, Stock Buzz) said it was rethinking its capital investment projects around the world to see if it could cut costs or delay them.
Oct 27 - Ufaleynickel, Russia's No.3 nickel producer, said it had stopped production of the metal due to a fall in world prices. An official said it cost the firm $26,000 to produce a tonne of nickel. In May, the company said it aimed to produce 14,000-16,000 tonnes of the metal this year.
Oct 27 - South Africa's Simmers & Jack (SIMJ.J: Quote, Profile, Research, Stock Buzz) said it would pursue a slower and more selective build-up of its projects due to the global credit crunch. The company in April outlined development projects at its Buffelsfontein and Transvaal gold mines to cost $99.8 million over the next five years, but said it would now prioritise them owing to the funding crunch.
Oct 27 - The Russian Copper Company (RCC) said it had decided to freeze all its investment projects for 2009 and to optimise production costs due to the global financial crisis and falling metals prices. The next day, Outotec (OTE1V.HE: Quote, Profile, Research, Stock Buzz) said its project for RCC's Miheevsky concentrator had been suspended.
Oct 24 - Brazil's Vale (VALE5.SA: Quote, Profile, Research, Stock Buzz) said it was reducing production at some high-cost operations, including a 20 percent cut in nickel output at its PT Inco unit in Indonesia. The company will also reduce activity by 65 percent at its Dalian processing unit in China.
Oct 24 - Katanga Mining (KAT.TO: Quote, Profile, Research, Stock Buzz) said it had started a review of capital expenditure commitments with a focus on optimising its development programme considering current market conditions.
Oct 24 - German engineering group GEA (G1AG.DE: Quote, Profile, Research, Stock Buzz) said it was preparing to close down its Ruhr-Zink GmbH zinc producing unit after attempts to sell it failed. A final decision depends on the outcome of talks with worker representatives, but a shutdown is pencilled in by the end of 2008. Analysts said the unit was no longer profitable.
Oct 24 - China's Tongling Nonferrous Metals 000630.SZ has reduced its refined copper output due to low prices, company sources said. A source at Jinlong Copper, a subsidiary of Tongling, said the smelter was also cutting production. Jinling is also partly-owned by Japan's Sumitomo Metal Mining Co Ltd (5713.T: Quote, Profile, Research, Stock Buzz).
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