Outokumpu, the Finnish company that owns Tara Mines, yesterday said it is to reopen its Navan zinc mine in September as planned, securing almost 700 jobs in the process.
The mine has been closed since last November, when it was decided to halt work after the price of zinc fell so low on world markets that production at the site was no longer viable. However, Tara Mines yesterday said zinc prices were beginning to rise again and that a programme to improve Tara's productivity was complete.
Because of that upgrading work at the Navan mine, around 550 workers were re-hired in March, just five months after they were laid off. Those workers will now be joined by around 110 more when the mine becomes fully operational next month.
Tara managing director Mr Eero Laatio said, while the price of zinc, at $7.65 (€7.78) per tonne, was "disappointing", it was a slight improvement on recent levels. "We are hoping that trend will continue," he said.
A statement from the company added that weak zinc prices should improve next year when excessive inventories are reduced.
It also said Tara's current productivity was "much better due to the improvement programme".
"Even in these market conditions [with low zinc prices\], Tara is expected to cover all operating costs but not full depreciation costs yet," the statement said.
In the current year, the mine will produce 60,000 tonnes of zinc in concentrate increasing to 200,000 tonnes in 2003.
However, while the company said the development work and recent Bula acquisition "form a solid foundation for Tara's future as a viable long-term zinc mine", it will continuously review operations and take steps to reduce costs should the need arise. In the past, the mine has closed for periods and laid off workers. Next year, when two new ore bodies adjacent to the Navan orebody are brought into production, Tara's cost position will be further enhanced, according to the company.
Earlier this month, Tara bought Rennicks and Bennett, a small company formerly owned by Glencar Mining with a three square mile site beside Tara's Navan mine. In July the company also finalised the acquisition of Bula's Nevinstown orebody, which also lies adjacent to Tara's mine. That €35 million deal ended a near 30-year battle with Bula over mining rights in the area. It also extended the life of the mine by five years to 2014.
