Taseko suspends production at B.C. copper mine
Taseko Mines Ltd. [TKO-TSE] said operations at its Gibraltar mine in British Columbia have been suspended.
In a press release on June 1, 2024, the company said collective bargaining with Gibraltar’s union representatives has been ongoing in recent weeks, and ended Friday without an agreement being reached.
The company said Gibraltar’s unionized workforce informed the company that they intended to take strike action as of midnight, May 31, 2024. The company elected to systematically shut down mining and milling operations prior to the midnight deadline, and the mine is now on care and maintenance with only essential staff operating and maintaining critical systems.
Taseko shares moved lower on the news, falling 3.7% or $0.14 to $3.59. The shares are trading in a 52-week range of $4.20 and $1.45.
Taseko is a Vancouver-based company with a portfolio that includes the Gibraltar mine in British Columbia, the Florence Copper Project in Arizona, and the New Prosperity copper-gold project, which is located near Williams Lake, B.C.
Back in March, 2023, the company completed the acquisition of an additional 12.5% interest in the Gibraltar mine from Sojitz Corp. and now holds an effective 87.5% stake in the mine.
Florence Copper is an in-situ copper recovery project located midway between Pheonix and Tucson, near the community of Florence, Arizona. Development is being performed in two phases, including a phase one production test facility and a second phase commercial facility.
Florence is expected to produce an average of 85 million pounds of copper annually during a projected lifespan of 22 years. Operating costs are forecast at US$1.11 per pound.
Taseko has suspended production at Gibraltar after recently announcing that operations performed generally in line with plan in the first quarter of 2024, generating strong margins on a realized copper price of US$3.89 per pound.
The operating team successfully completed a mill component replacement in January (2024) and following this maintenance, and following this maintenance downtime, mill throughput averaged 90,000 tons per day, 6.0% above design capacity.
The company said the gradual transition to the Connector pit will continue over the next few months, and the in-pit crusher relocation is planned for the second quarter.
In the first quarter of 2024, Gibraltar produced 30 million pounds of copper and 247,000 pounds of molybdenum. Mill throughput in the quarter was 7.7 million tons, or 84,400 tons per day, processing an average grade of 0.24% copper. Total operating cash costs for the quarter were US$2.46 per pound of copper.
Taseko reported first quarter 2024 adjusted EBITDA (earnings before interest, tax, depreciation and amortization) of $50 million, and earnings from mining operations before depletion and amortization of $53 million, 38% and 29% higher than in the same quarter in 2023. Revenue in the first quarter was $147 million. Net income for the quarter was $19 million or $0.07 per share.