PERTH (miningweekly.com) – Mineral sands miner Iluka Resources has warned of a possible A$86-million impairment over its US operations, as mine plans for these operations were adapted.
The company has mining and processing operations at two mine sites in Virginia, as well as a separation plant at the nearby Stony Creek. The operations produce chloride ilmenite and zircon, which is sold into the US markets.
The miner had also been evaluating two mineral sands deposits able the use the Stoney Creek separation plant, namely the Aurelian Springs deposit, in North Carolina, and the Hickory deposit, in Virginia.
However, the company told shareholders that a review of its US operations had resulted in the decision to maximise cash flow from the Virginia ore bodies, while minimising further development expenditure. This meant that mining of the Brink and Concord deposits in the most effective manner, would result in the completion of mining and processing activities in the US by the end of 2015.
“Iluka’s approach to project evaluation and development is based on keeping various internal options available for commitment, yet ensuring development occurs only if and when an appropriate risk/return balance can be achieved to create and deliver value for shareholders,” said Iluka MD David Robb.
“We are naturally disappointed that we are unable, at this time, to confirm the extensions of our US operations beyond their original planned life to our employees, customers and other stakeholders.”
Iluka would continue to hold mineral leases upon the Aurelian Springs and Hickory resources.
Robb added that the company would also continue to progress other internal production options within its portfolio, as well as to evaluate suitable external growth opportunities.