The largest lead mine in the world will be placed on care and maintenance next month, leaving 200 miners and contractors without a job.
The Paroo Station lead mine, situated in the Goldfields, Western Australia, is about to cease operation for the third time in less than ten years – this time, due to declining metal prices.
Lead prices have tumbled from a high of $2,300 US a tonne recorded earlier this year, to below $1,750 US a tonne.
Paroo Station is located 30km west of Wiluna and is owned by Rosslyn Hill, a wholly owned indirect subsidiary of Canadian metal mining company Ivernia.
Ivernia said it will initiate a safe and orderly scaling back of activities soon and move the operation to care and maintenance.
“Despite record production and sales in 2014 and the progress we have made to reduce costs and improve efficiencies at the Mine, the current LME lead price has dropped well below sustainable levels and cannot support profitable ongoing operations. In order to protect shareholder value and conserve the viable deposits of our ore body, the decision has been made to place the Mine on care and maintenance until further notice,” said Wayne Richardson, President and CEO in a news release.
“The Company continues to progress its updated life-of-mine plan which will revise its resource and reserve estimates and estimated mine life in the context of various factors including depletion from mining activities, data from the in-fill drill program, revised assumptions and methodologies for the geological model such as cut-off grade, a revised cost structure taking into account external cost drivers such as higher treatment charges and a lower lead price environment. This work, once completed, will form part of a new independent NI 43-101 technical report to be filed in the first quarter of 2015,” reads the news release.
Paroo Station mine will be poised to return to full production once price conditions improve.
