Singapore 07/12/2015 - Nyrstar has announced on Monday that it is placing its Middle Tennessee Mines (MTN) in the US on care and maintenance. The decision will result in around 50,000 tonnes per year of zinc-in-concentrate being taken out of the market.
Zinc metal production at the nearby Nyrstar Clarksville smelter will be reduced by about seven percent, equivalent to around 9,000 tonnes per year, it said.
The Nyrstar Clarksville smelter will continue to be supplied by East Tennessee Mines and additional external sources.
Middle Tennessee consists of three mines and one processing plant.
“The decision to put our Middle Tennessee Mining operations on care and maintenance was not taken lightly. However, given the continued depression of the metal price environment, it is the right decision for the company,” said Bill Scotting, CEO of Nyrstar.
“We continue to take decisive action to reduce spending in our mines, and further mine operation suspensions may be necessary if the depressed metals price environment continues. We expect to complete the process to divest the majority or all of our mines over the course of 2016.”
A small team of essential staff will remain at the MTN sites to ensure a smooth transition into care and maintenance over the next few months, while ensuring that high safety and environmental standards are maintained, the statement said.
The company had said in November that it was pursing strategic alternatives for its mining assets, both individually and as a portfolio which could result in additional mine suspension, asset disposal or a full exit from mining.
Should commodity prices remain weak, Nyrstar said it will consider further suspensions of its mines, which could potentially reduce global supply by up to a further 400,000 tonnes of zinc concentrate – this is in addition to the 100,000 tonnes removed by the Myra Falls and Campo Morado suspensions.
The London Metal Exchange three-month zinc price was last trading at $1,565 per tonne, a $13 increase on the previous day’s close.
(Additional reporting by Kathleen Retourne)