Work Stops at Europe's Largest Zinc Mine in Ireland

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Work at Europe's largest zinc mine, located in Ireland, has been shut down "temporarily" by parent company Boliden (Stockholm, Sweden).

More than 650 workers have been laid off as the company confirmed that all exploration and production at Tara Mines in County Meath were being suspended for what the company called a "a combination of factors," including low zinc prices and high energy costs.

"The Tara mine in Ireland will be placed under care and maintenance," the company said. "The decision means that production and exploration ceases temporarily at the mine. The Tara zinc mine in Ireland is a high-cost mine with approximately 650 employees. Boliden is working actively to extend the life of the mine in parallel with ensuring its competitiveness. The business is currently cash flow negative, due to a combination of factors including operational challenges, a decline in the price of zinc, high energy prices and general cost inflation."

The decision at Tara comes as Boliden is suffering elsewhere. In the past week, the company was forced to suspend output from its largest production unit, the Ronnskar smelter in Sweden, after a fire broke out and destroyed the cell house. The company expects to take a financial hit of US$65 million on its second-quarter earnings before interest and tax. The smelter could be offline for a number of weeks.

Ronnskar is a major producer of metals with an annual capacity of copper (218,000 tonnes), zinc clinker (33,000 tonnes), lead (29,000 tonnes), sulfuric acid (550,000 tonnes), silver (467 tonnes) and gold (12 tonnes).

No date has been given for a possible resumption of production at Tara. Gunnar Nyström, general manager of Tara Mines, told reporters: "We are acutely aware of the difficulty and disruption that this decision will cause for our employees, and the wider community in Navan, where the mine has been operating since 1977. This was not a decision we made lightly, but we simply have to stem the unsustainable cash outflow that we are currently experiencing, in order to safeguard the long-term future of the mine. We will remain in dialogue with our employees and stakeholders throughout this period."

Ireland's Minister for Enterprise, Trade and Employment, Simon Coveney said: "Tonight's decision of the board in Sweden is a shock and my thoughts are with all of the workers affected. The company has tonight told me the board is convinced this is a temporary closure. The government will continue to engage with Irish management and the parent company to try to reverse this closure."

Industrial Info is tracking a key project at Tara to expand the operation with the construction of a new, 2-kilometer drift tunnel to mine from a new mineralization with an inferred mineral resource of 10 million metric tonnes.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).