Photo by Whitehorse Star
FUTURE IS TENUOUS – ‘Everybody is doing what they can to get through this survival mode,’ says Ron Light, the manager of the Minto Mine (above).
More grim news hits Yukon mining industry
With the continuing decline in the price the copper, Capstone Mining is planning to cut back operations at its Minto Mine, says mine manager Ron Light.
With the continuing decline in the price the copper, Capstone Mining is planning to cut back operations at its Minto Mine, says mine manager Ron Light.
Light said in an interview this morning the company plans to stop underground mining at the end of March.
It will end its open pit mining in August.
Plans are to stockpile ore to keep the mill operating into April 2017, then implement a temporary closure to wait for the price of copper to rebound, he said.
Light said there are approximately 40 contract underground miners employed by Dumas Mine Contracting who will be affected.
Come August, if nothing changes, the local crew of some 76 Pelly Construction employees conducting the open pit mining would be reduced significantly, he said.
Light said they’ll still need some of Pelly’s heavy equipment operators at the mine to maintain day-to-day operations, but just how many wasn’t clear this morning.
If the mine goes into temporary closure next year, he added, Capstone would still require a crew to provide care and maintenance of the mine site.
If the price of copper was right, there’s enough of an ore body left to keep mining at Minto for another six years, into 2022, he said.
Light said he believes copper would have to return to upwards of $2.20 US or $2.30 a pound before Capstone would reconsider its current strategy.
Copper was selling this morning for $1.98 per pound. In its 2016 operating plan announced Monday, Capstone estimates its cost of producing one pound of copper at the Minto Mine is between $1.90 and $2.
Light said the morale among workers at Minto is still good, despite the situation.
“People are looking at the positive things we can do to reduce costs and keep our head above water,” he said.
“Everybody is doing what they can to get through this survival mode.”
Over the last five years, the price of copper has fallen steadily from the $4.60 a pound it was sitting at in January 2011.
In the last 30 days, it’s dropped from $2.14 a pound.
There are approximately 322 workers at the mine, of whom 162 are employed directly by Capstone along with 160 contract workers, including the Pelly Construction crew.
The Minto Mine is the only producing hardrock mine in the Yukon.
The Wolverine Mine suspended operations a year ago and is currently in a care and maintenance mode.
Alexco Resource put its Bellekeno mine into care and maintenance in the fall of 2013 amid slumping silver prices.
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Comments (16)
Up 22 Down 8
Francias pillman on Jan 22, 2016 at 2:18 pm
Yes Amanda. Unwavering. Like how he jumps political parties every year. Every mine has shut down. I see nothing but excuses. How can anyone like that be trusted? Low mineral prices is a very small part of all this. I see someone who is the face of mining, who has zero mining experience what so ever. And those Amanda are facts.
Up 11 Down 8
open eyes on Jan 22, 2016 at 1:46 pm
There is no question that mining is and will continue to be one of the main stay drivers of the Yukon economy. The real problem is we have no value added economy here for any of our raw commodities due to a lack of adequate transportation systems and infrastructure. When selling nearly raw commodities one is highly vulnerable to global valuation of that commodity. Well rounded economies reduce this vulnerability by building infrastructure which encourages value added processing for raw commodities. Hence, when the raw commodity tanks in price the value added operations may still be marketable at a profitable price. In addition, I would like Yukoners to better appreciate the other drivers in our economy, such as tourism, and yes, government transfer payments. We must remember that we are still a "territory" of Canada. If Canada desires to continue to lay claim to this territory it must establish itself through the creation of the statute government known as YTG. Without which there would be very little here at all. In low mining activity we should be grateful for the federal transfers which keep us going until the next up surge in raw commodity prices.
Up 11 Down 6
Amanda Leslie on Jan 22, 2016 at 9:17 am
Arn, Samson Hartland did not leave his position as the Executive Director of the Yukon Chamber of Mines - that's his full-time job and his commitment to it and to the territory's mineral exploration and development industry is unwavering.
City of Whitehorse Councillors commit to that (part-time) role outside their regular employment (unless they are retired).
Up 12 Down 7
ProScience Greenie on Jan 21, 2016 at 3:48 pm
Good points and food for thought Average Joe. Thanks. Someday I should hack together an essay about the reasons why I felt a need to break ranks with the 'progressive' left/green movement. That separation began when I realized that they were as loony, scary and in many cases as anti-science as the t-party/reform types.
Up 30 Down 10
Just Say'in on Jan 21, 2016 at 3:42 pm
Well I know one thing. When the last mine closes its doors then there better be a huge layoff in YTG and the Feds. Mining recorders, Land use, Water use, Fisheries and Oceans, YESAB, Wildlife, Workers Comp, OH&S, it goes on and on. Oh I forgot about our crack team of Mine rescue guys. When the miners are gone they better be gone too. We don't need hundreds of high paid Government employees just warming the hardwood. And the next time there is talk of a new mine maybe when they know how it will affect their mortgage they will have a different opinion.
Up 13 Down 20
moe on Jan 20, 2016 at 8:14 pm
Proscience Greenie, I have no problem with tour companies paying for using our resources. Let's clear that up first of all. There are lots of German and other international operators here who do take the money right out of the country and that's not right. They should be paying for the tourism infrastructure and support they get, and for the fact that we have not yet completely destroyed our natural ecology in Canada. Specifically in the Yukon, where we are still in good shape.
Now let's talk about you claiming you have no contempt for the tourism industry. Your words, "For sure the eco-tourism industry will be pumped about their clients not having to run into any icky miners out in the wilds or on the streets."
What 's that? It is contempt. I don't care either, other than you claiming otherwise. Just pointing it out. 'Greenie'.
Your next statement in the same post, "Maybe we should start looking at some hefty fees for that industry to bring some more money into our Yukon coffers." Completely overlooking the fact that the 'hefty fees' that the mining industry pays are so low that it's probably not worth paying someone to collect them.
Now which industry gets so much 'support' from the government? That was another post of yours. Multi-million dollar highway upgrades to a Chinese owned mine which promptly shuts the door and stiffs their suppliers.. remember that one? Infrastructure, departmental support, it goes on and on. Ain't it grand!
Just give it a break with your routine that you are this impartial, wise and informed person who just says it like it is. That's all I'm saying. Own where you are coming from and be honest.
Up 17 Down 2
Average Joe on Jan 20, 2016 at 6:46 pm
Pro Science Greenie
You make a good point, where some who are in favour of responsible mining are seen as rabidly pro mining, but the inverse is also true, where anyone here who says anything against mining is portrayed as anti mining. You yourself seem to allude to this with your comment that's so many here are anti mining. Just because someone supports a management plan for the Peel, for instance, that provides for protection in the near future, and review later on, does not make one anti mining. I think if you spoke to most Yukoners, there would be a majority who do want responsible development while maintaining the wilderness character of places like the Peel watershed. We can have both. I have yet to see or hear any sort of landslide opposition to project like Casino or Kamninaks plans. I do hear a call for proper planning for these projects, but no rabid protestation.
Ultimately, the mining industry in the Yukon tends to be its own worst enemy, with projects like Wolverine, and others, walking away from their responsibilities leaving who knows who to deal with it. It's hard not to become jaded when companies are throwing out news releases touting their new projects as the next "big thing", or as one recent new article quoted of Rob McIntyre re the latest reiteration of the kudz ze kayah project, " these guys are the real McCoy.
Up 5 Down 14
Arn Anderson on Jan 20, 2016 at 4:04 pm
Hence why Samson Hartland left the Yukon Mining association, left before things got worse and jumped on city council with the slimmest of voting margins. Enjoy Whitehorse as it probably isn't going to get better (cough, Seewell house, cough).
Up 21 Down 7
ProScience Greenie on Jan 20, 2016 at 3:53 pm
No contempt for any industry moe. However in a territory with so many that are almost rabidly anti-mining, those of us that see some responsible modern mining as important to our overall economy will seem to be pro-mining. Easier I guess just to reject the whole industry rather than research each project and to be familiar with the current regulations.
I know lots of great people that work or have worked in the mining industry. Very skilled and many highly educated, as in science and engineering. Nothing wrong with wanting them to have full time employment. I have a heart for them but obviously many in this territory lack any compassion at all.
Royalties are another issue which will no doubt be dealt with in the future. Let's hope they are scaled and reasonable. Don't forget that there are also FN benefit agreements which are in a way royalties and a good thing.
As far as tourism and eco-tourism goes, it's about time they started paying fees something for the use of the wildland and our infrastructure. Why shouldn't they, especially considering the govt. support they get and the amount of profits that go Outside. The clients will pay for it anyways so what's the big deal of charging big for it.
And there is no law telling people that they can't be green and want a strong mixed economy at the same time. Heck, people can even lean politically to the right and still be green. Shocking isn't it.
Up 22 Down 2
AlexNeilGeddy on Jan 20, 2016 at 2:48 pm
No suprise here really the base metal markets have been heading for the gutter for awhile. One bright spot in this economic rut that will happen is an up tick in gold prices. Economic growth in the US has been less than stellar and confidence in China's economy is waning.
If Kanimak's forward path holds true they may be operational by 2018, Vic Gold needs some investment but have their permitting in place.
I've been in the business for 20+ years and survived well. One resource market drops, another rises. I hear same old, same old from armchair economics anti-mining generals that just doesn't equate.
Up 10 Down 21
moe on Jan 20, 2016 at 2:42 pm
To ProScience Greenie, oh ya! Hefty fees like the 37 cents an ounce we are getting for the placer gold taken out of the Yukon. You are stuck on a broken record and your moniker increasingly seems like a joke with your contempt for any industry besides mining.
Up 45 Down 25
Steve E on Jan 19, 2016 at 9:16 pm
Yukon doesn't need mining anyway. Ottawa supplies the cash that fuels the false economy. Government jobs and a service industry are all you need. Mining is just fluff with a lot of expensive cleanup. Is there ever any layoffs in government?
Up 39 Down 11
ProScience Greenie on Jan 19, 2016 at 5:26 pm
For sure the eco-tourism industry will be pumped about their clients not having to run into any icky miners out in the wilds or on the streets. Maybe we should start looking at some hefty fees for that industry to bring some more money into our Yukon coffers.
Up 30 Down 5
ProScience Greenie on Jan 19, 2016 at 5:25 pm
It has to be asked - what are all our mining inspector type people doing at work every day? A great bunch of people but are their jobs going to be on the line?
More and more resource workers out of work and it will trickle down to all the service and supply companies. Not good. These are good people - our family, neighbors and friends. I feel for them however we hear no concern from the Opposition or biggest labor union in the territory. Some actually seem to be happy that miners are getting laid off which breaks my heart as that shows how far they have drifted from our parent's and grandparent's NDP and unions that were all about good paying resource jobs.
Up 13 Down 7
Gadzutz on Jan 19, 2016 at 5:14 pm
I guess we should blame the greenies, or the First Nations, or the regulatory process.....someone, because how could the cornerstone of the Yukons economy fail all on its own?
Up 21 Down 1
Things are changing on Jan 19, 2016 at 3:21 pm
so fast and all the uncertainty is putting the world in a step back mode.