Photo by: Reuters
TORONTO (miningweekly.com) – North American rare earths producer Molycorp will close its Mountain Pass rare-earth facility, in California, on October 20.
Molycorp, which operated Mountain Pass, the largest rare earths mine outside of China, and its processing facility, had on June 25, along with its subsidiaries in North America, filed for Chapter 11 bankruptcy protection to restructure debt of $1.7-billion in its US and Canadian operations.
Small operators such as Molycorp, which had reported a loss for at least 13 consecutive quarters in May, were hard-pressed to squeeze profit from their operations.
Rare-earth pricing had declined dramatically over the past four years, being a key factor in the company’s decision to suspend rare-earth production at Mountain Pass, company officials said.
Molycorp's rare earth magnetic materials customers, as well as its rare-earth-based water treatment products, would not be impacted. The company planned to continue serving its rare earth oxide customers through its production facilities in Estonia and China.
While the company planned to idle machinery and equipment, it would still be maintained to ensure it remained in a safe and stable condition, and that it met government regulatory commitments.
Molycorp was being advised by investment banking firm Miller Buckfire & Co and was receiving financial advice from AlixPartners. Jones Day and Young Conaway Stargatt & Taylor acted as legal counsel to the company in this process.