Talvivaara Mining Company Plc plans rationalization of its operations
Talvivaara plans rationalization of its operations
Talvivaara Mining Company Plc (“Talvivaara” or the “Company”) plans changes in the group’s organization to support the Company’s reorganization program and rationalization of operations. Talvivaara believes that the planned actions will accelerate the efficiency programme started last summer. The actions will also increase productivity and, together with a short term shut-down of the metals recovery plant and reduction of outsourcing, lower operational expenditure and help create an organization that better reflects the current situation of the group.
Talvivaara estimates that the planned changes may cause redundancies, lead to part-time employments and/or lay-offs and may have employee impact on the whole staff. The Company has invited employee representatives to consultations according to the applicable legislation. All Talvivaara group companies, Talvivaara Mining Company Plc, Talvivaara Sotkamo Ltd and Talvivaara Exploration Ltd, are within the scope of the consultations. The possible employee impact per employee group will be defined during the consultation process. The group’s current headcount is approximately 570 employees.
The short-term actions to optimize production and operational expenditure consist of, among others, a shut-down of the metals recovery plant, which takes effect immediately and is estimated to be approximately one month in duration, and a temporary stoppage of ore production. The operations of the metals recovery plant have not been cost effective during this autumn due to the low metal concentrations in the leach solution. As a result of the stoppage, the metal grades in solution are expected to rise, as leaching of the ore stacked since last spring progresses. The Company plans to discontinue ore production in the coming weeks for approximately six months. In the event the Company’s financial situation improves significantly already in the coming months, the mining and materials handling operations can be re-started already earlier. The temporary discontinuation of ore production may have a negative impact on water management and it will likely slow down the ramp-up of production to its planned capacity.
Talvivaara has previously announced that it estimates its nickel production during the second half of 2013 to exceed 4,508 tonnes, which was achieved during the first half of the year. Due to the imminent stoppage of the metals recovery plant, the Company now estimates its nickel production to amount to approximately 4,000 tons in the second half of the year.
Talvivaara Mining Company Plc
Talvivaara Mining Company is an internationally significant base metals producer with its primary focus on nickel and zinc using a technology known as bioheapleaching to extract metals out of ore. Bioheapleaching makes extraction of metals from low grade ore economically viable. The Talvivaara deposits comprise one of the largest known sulphide nickel resources in Europe. The ore body is estimated to support anticipated production for several decades. Talvivaara has secured a 10-year off-take agreement for 100 per cent of its main output of nickel and cobalt to Norilsk Nickel and entered into a long-term zinc streaming agreement with Nyrstar NV. Talvivaara is listed on the London Stock Exchange Main Market and NASDAQ OMX Helsink. Further information can be found at www.talvivaara.com
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