Thompson Creek Metals Co. will suspend stripping activity associated with the next phase of production at the Thompson Creek mine, referred to as Phase 8. Mining operations will continue as planned through 2014 in the current phase of production at the Mine, referred to as Phase 7.
As a result of this change, between now and 2014, the company expects to save approximately $100 million in operating costs and as much as $9 million in capital expenditures, as well as reduce the mine workforce by approximately 100 workers.
“As a result of continuing weakness and uncertainty in the world economy, we have decided to reduce our costs, strengthen our balance sheet, and conserve cash,” said Kevin Loughrey, chairman and CEO, Thompson Creek. “This will allow for greater certainty in accessing our existing financings in order to complete the development of Mt. Milligan, while we preserve the assets at Thompson Creek until market conditions strengthen.”
The company announced that it would expect to restart stripping of Phase 8 of the mine plan when market conditions warrant. The Thompson Creek Mine is expected to produce 20-22 million lb of molybdenum in 2013 and 17-19 million lb in 2014. Assuming stripping is not restarted prior to 2015, cash costs are expected to be approximately $4.75/lb to $5.75/lb in 2013 and $5/lb to $6/lb in 2014. If stripping has not recommenced by 2015, the company expects the mine to be placed on care and maintenance. The company’s Langeloth roasting facility in Pennsylvania will continue to treat material from the Thompson Creek mine, third party purchased concentrates and tolled molybdenum concentrates.