With the zinc market showing no signs of recovery, Falconbridge (FL-T) has decided to extend by a month the previously planned 8-9-week shutdown of refining operations at its Kidd metallurgical site in Timmins, Ont.
The closure will run from the end of June until September 30, and is aimed at offsetting a supply shortfall for 2003, allowing the refinery to build up inventory and operate well into next year.
Daniel Picard, general manager of the Kidd division, says the decision is based on the persistence of low revenue from treatment charges, changes in currency exchange rates, higher energy costs, and low metal prices.
The company says it plans to fully supply customer sales commitments during the closure. However, zinc production during 2003 is expected to slip by 35,000 tonnes to an estimated 110,00 tonnes.
During the shutdown, Falconbridge plans to reassign some of the refinery workers to vacation relief at the operation’s concentrator, copper smelter and refinery and support departments. The Kidd operation has 295 employees.
“We will also use our own employees to perform scheduled annual maintenance work in both the smelter and zinc operations, and employees will take their vacation during the shutdown. However despite this, there will be some temporary layoffs,” adds Picard.
During the first three months of 2003, the Kidd Creek division suffered an operating loss of $21 million, as cash costs jumped 73% to US97 per lb. copper, net of zinc credits.
During all of 2002, the division chipped in an operating loss of $78 million, despite increased mine production and record volumes of refined copper and zinc. Cash costs averaged US62 per lb.
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