Xstrata Copper Canada announced on December 7, 2009, that it will permanently shut down the metals and byproduct production facilities at its Kidd metallurgical site in Timmins, Ontario on May 1, 2010. The site is located 27 km southeast of the company’s Kidd mine and includes a concentrator, a copper smelter and refinery, and zinc, cadmium, indium, liquid sulphur dioxide, and sulphuric acid production plants. The metallurgical plants have annual capacity to produce 150,000 mt/y of blister copper, 145,000 mt/y of cathodes, and 150,000 mt/y of zinc.

The Kidd mine and the concentrator at the metallurgical site will remain in operation. Xstrata is currently investing C$100 million at the mine to extend its workings down to the 9,500-ft level and extend mine life to 2017. Kidd concentrate production will be integrated with production at Xstrata’s Horne smelter at Rouyn-Noranda, Quebec, and its CCR refinery at Montreal.

The Xstrata announcement said the decision to close the Kidd metallurgical plants came after an investigation of various options to improve their financial performance in the face of global smelting overcapacity, record low treatment and refining charges, increasing operating and capital costs to run and maintain the plants, and lower demand and sales prices for sulphuric acid.  These issues were exacerbated by the appreciation of the Canadian dollar against the U.S. dollar, the statement said. The shutdown was expected to result in exceptional closure-related costs and asset impairment charges of approximately $375 million, to be reflected in Xstrata’s 2009 financial statements.

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