Earth AI, Legacy Minerals make first greenfield palladium discovery using artificial intelligence
Companies announced the verified discovery of one of the largest palladium mineral systems in Australia.
Atlas Iron is shutting down its operations due to low iron ore prices, the company announced on Friday. As the fourth largest iron ore producer in Australia, the closure is the biggest casualty so far of depressed iron ore prices, which are trading at their lowest levels in a decade.
“Atlas Iron (ASX: AGO) advises that due to recent significant falls in the iron ore price, it will progressively suspend its mining operations over the month of April, with exports to cease shortly thereafter,” the company said in a statement.
“Despite an extensive cost-cutting program, to which staff and contractors have made significant contributions, the global supply-demand imbalance for iron ore has driven prices down to the point where it is no longer viable for Atlas to continue production. Atlas has continued to reduce costs significantly and its break-even price on a benchmark 62Fe basis is currently below USD$60/t at an EBITDA level. However, despite these substantial reductions, Atlas’ breakeven price remains well above the current spot price. In light of this, Atlas will cease mining and crushing at its Mt Webber project next week. Mining and crushing at the Abydos project is scheduled to cease within 14 days and operations at the Wodgina mine are expected to be completed in late April. All Atlas’ projects will be put on care and maintenance, pending future iron ore market conditions.”
The move comes as no surprise to the market, after Atlas Iron shares were suspended last Tuesday.
US-based bondholders of the Perth-based company could also push the miner into receivership and administration until the iron ore price recovers to levels of around $65 – $70 a tonne which Atlas needs to stay cash positive.
Founded by respected WA mining veteran David Flanagan, Atlas listed in 2004 and grew quickly to be one of the biggest second-tier producers, pumping out about 13 million tonnes a year.
But its decline, like that of the iron ore price, has been swift. Atlas’ market capitalisation has shrunk to $110 million – a third of the size of its debt pile – from $1 billion a year ago and more than $3 billion in 2011.
The price slump has also affected the Iron Ore Company of Canada, majority-owned by Rio Tinto, which announced last Thursday it is sending out 150 layoff notices.
IOC employs roughly 2,500 people in Labrador West and Quebec in eastern Canada and produced 15 million tonnes in 2013.
7 Comments
Dave Gorey
Why do we continue to seel a product at such a reduced rate. Surely you would suspend selling especially so much until prices picked up ??
The Observer
There will be Champagne celebrations at B.H.P. and Rio tonight, another competitor gone to the wall. Just wait till Gina’s, Roy Hill, starts pumping it out in 4 months, then the price will really drop.
NorthAfricanMiner
Are we really sure BHP and the others are really profitable at the current market price? The cash cost is only part of the story, make few calculations from their FY2014 annual report and see.
Altaf
Its not if Vale, Rio and BHP are profitable at these prices. They are not into this for survival. They intentionally increased production to drop prices so that high cost small miners go out of business. Even bigger target is to push out low quality, small Chinese miners out. Non Chinese miners with high cost production are just causalities in the international game. However Chinese miners are sticking out. As long as 50% of Chinese small mines are not closed, the Big 3 will not stop this game. Until then those with high cost will be affected.
Dave Gorey
I think it highlights how irresponsible and greedy businesses can be and the need for Government to regulate, why go hard for 5 years when we could be consistent for 50?
Why do we allow big business to ruin it for everyone whether they be high cost miners or not. If they run at a high cost and sustain it I guess its reasonably good business and if they cant then they cant.
The big 3 are effecting thousands of people and there livelihoods whilst government sits back and allows it to happen and in turn screws the public harder with price rises and taxes, all because of one very simple word ….. GREED
Wes
Atlas was a horrible place to work compared with BHP. They lack vision and they deserve it.
Scotty to Hotty
And the winner is the Chinese they are probably laughing at the whole thing