Putin scolds Tomtor rare earth deposit’s operator over development delays
Located in the north of the Siberian region of Yakutia, Tomtor is a key project in Russia's plans to boost output of rare earth.
Shares of Molycorp (NYSE:MCP) plunged more than 10% at the open on Thursday to a new 52-week low of $5.60 after the firm delayed its full year results to account for a “substantial” impairment charge.
Before midday the rare earth miner’s volatile stock – a favourite among resource punters – was back to breakeven with more than 11 million shares having changed hands already.
The Colorado-based company said it will now file its 10-K by March 15 to give it more time to calculate a goodwill write down related to its acquisition of Neo Materials Technologies for $1.3 billion in March.
The delay is the latest in a string of bad news – including an SEC investigation and sudden CEO departure – for already shell-shocked investors who have seen the counter slide 34% just this year and 76% from a year ago.
Molycorp in January warned its 2013 revenue will be lower than previously forecast as rare earth oxide prices continue to spiral downwards.
The company has restarted mining and processing at Mountain Pass in California, the largest deposit outside China.
The ultimate production target at the mine – once the largest in the world – is 40,000 tonnes per annum.
Molycorp has spent $1.25 billion to bring capacity halfway there, but in January also announced tough market conditions is putting phase two of the production ramp-up on hold.
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