Minsur’s Taboca subsidiary in Brazil temporarily halted production at its Pitinga mine at the start of the month due to power supply problems, but has now resumed operations at a reduced rate. Taboca had targeted a 20 – 30% increase in its tin production in Brazil in 2015, offsetting lower output from its San Rafael mine in Peru. The Pitinga mine produced 5,532 tonnes of tin-in-concentrate in 2014, and in the first half of 2015 production increased by 25% year-on-year to 3,256 tonnes. In the same period refined tin production at the Pirapora smelter increased by 19% to 2,621 tonnes. Net costs of tin production at Pitinga (after allowing for co-product revenues from tantalum and niobium) in the first half of 2015 were US$14,481/tonne, down by 18% compared to the same period of last year due mainly to the devaluation of the Brazilian Real.
In its first half 2015 consolidated earnings release of 14 August 2015, Minsur described the situation at the remote mine in Amazonas as follows: “During the first week of August, water filtrations were found at the dike of the hydroelectric plant that provides energy to Pitinga, forcing the hydroelectric plant to work at half of its capacity. As a precautionary measure, the Company decided the temporary suspension of activities at the mine in order to evaluate and repair the water filtrations in the hydroelectric plant. The company is currently evaluating different alternatives to gradually resume operations at Pitinga, with a limited production capacity, depending on the energy that could be generated during the repair work at the hydroelectric plant, and on alternative power generation capacity that could be implemented. At this moment it is not able to make a production estimate or to determine how long this situation can take.”
At an analysts briefing yesterday, Minsur CEO Juan Luis Kruger said that production had been resumed, but at a materially reduced capacity. The company is currently evaluating various production scenarios depending on the energy that could be available during the repair work at the hydroelectric plant, as well as any additional power generation capacity that could be implemented. He stressed that there was no environmental impact nor any communities affected as a result of the problems at the hydroelectric plant, which is 80 km away from the mine.
