Mincor set to cut jobs, re-evaluate operations
Mincor Resources has spent $1.74 million on redundancy payments in the past six months, financial statements reveal, as the Kambalda nickel miner flagged another round of job cuts yesterday.
The depressed nickel price has forced Mincor to re-evaluate the future of its Mariners and Miitel operations and the miner will switch to a single shift to lower costs.
“Unfortunately it will also involve further redundancies among Mincor’s workforce,” the company said yesterday.
The change will also result in production falling to about 4000 to 5000 tonnes of ore per month.
Mincor is targeting 1500 tonnes of nickel metal, or 56,000 tonnes of ore at 2.8 per cent nickel, for the final three quarters of the 2015-16 financial year.
The latest restructure comes as consulting group Entech conducts feasibility studies on Mincor’s Durkin North and Burnett projects.
Mincor said the smaller-scale operation would enable the studies’ completion, as well as the drill-out of its Cassini discovery.
Durkin North could cost as much as $30 million to bring into production and Burnett is expected to be about $16 million.
The latest cutbacks follow Mincor’s move in May to stop capital development at Mariners and Miitel — a decision which cost 50 jobs, or a quarter of the company’s workforce.
By the end of July, both mines had been unified into a single operation, with one management team and one work crew.
It helped cut costs by 18 per cent as Mincor delivered 1550 tonnes of nickel-in-ore at cash costs of $6.38/ lb in the September quarter, down from $7.78/lb in the June quarter.
Mincor has spent $770,000 and $970,000 on redundancy payments in the past two quarters.
Despite nickel’s struggles, Mincor is in a strong financial position, with $31.4 million cash in the bank.
Fellow Kambalda miner Panoramic Resources has already placed its Lanfranchi nickel operations on care and maintenance, while Independence Group’s Long operations have scaled back production.