SMC’s Blue Hills mine falls victim to price slump, enviro delays
PERTH (miningweekly.com) – The falling iron-ore price has claimed another victim, with Sinosteel Midwest Corporation (SMC) announcing on Tuesday that the company would suspend its Blue Hills operation, in Western Australia, ahead of plan.
The mine, which had initially been slated to cease production in October this year, would now be closed by mid-May.
SMC GM Phil Allsopp said the weak iron-ore price was not the sole factor in the company’s decision to cease production from Blue Hills, noting that the tough economic conditions and lengthy delays in obtaining environmental approvals for the extension of the operation had left the company with no alternative.
Furthermore, a recent re-interpretation by the state government on royalties payable on mine-gate sales for iron-ore added to the costs of the operation, Allsopp said.
SMC submitted an application to the Environmental Protection Authority (EPA) in August 2013 to expand operations at Blue Hills, allowing for three years of additional mine life.
In November last year, the EPA informed the company that the proposed expansion was considered “environmentally unacceptable”, with the environmental body refusing to assess the proposal.
Allsopp said that the EPA’s decision not to assess the proposal to extend the mine life at Blue Hills was currently under appeal, but a final decision was not expected in time to avoid the closure of the mine.
Operational and corporate staff were likely to be made progressively redundant in line with operational requirements.
Allsopp reiterated that SMC remained committed to its projects in Australia, particularly the A$2-billion Weld Range operation, which was parked in 2011 owing to a lack of progress on port and rail infrastructure in the area.
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