TORONTO (miningweekly.com) – New York- and Paris-listed Cliffs Natural Resources on Monday said it would idle mine expansion in Quebec and a portion of production at two US operations as a result of weak iron-ore prices.
The company, which is the largest producer of iron-ore pellets in the US, said it would idle iron-ore production at its Bloom Lake mine Phase 2 expansion, in Quebec, and at two of its US iron-ore operations, Northshore Mining, in Minnesota, and at the Empire mine, in Michigan.
Cliffs said it was adjusting its 2013 operating plans for its North American iron-ore businesses to align with expected sales volumes. These production decreases were driven by increased iron-ore pricing volatility and lower North American steelmaking utilisation rates.
“Disciplined capital allocation is core to our operating strategy and reducing higher cost production will enhance our financial flexibility in both the short and longer term. Despite today’s announcement, we are still committed to our investments in Canada and believe Bloom Lake will deliver significant long-term value over time,” Cliffs chairperson and CEO Joseph Carrabba said.
At the Bloom Lake mine, Cliffs had suspended certain components of the second phase of expansion, including the completion of the concentrator and load-out facility. As a result, construction related to these activities was halted and third-party contractors were demobilised immediately.
Prestripping activities to develop the working faces of Bloom Lake’s orebody, supporting both Phase 1 and Phase 2 mine development would, however, continue.
Cliffs said it would also continue its environmental projects related to completing the mine’s water and tailings management system and ore storage facility.
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