Hundreds of employees at Endako Molybdenum Mine in Fraser Lake will have to go through the holidays knowing they will be out of a job in the new year.
Thompson Creek Metals Company announced Dec. 10 that the company and its joint venture partner, Sojitz Moly Resources, have agreed to place the Endako Molybdenum Mine on temporary suspension effective Dec. 31, 2014.
The reason is a “continued weakness in the molybdenum market,” according to the company’s press release.
“As a result of the current and expected molybdenum price weakness in the near term, we had no other option but to place the mine on temporary suspension,” said Pamela Solly, director of investor relations and corporate responsibility for Thompson Creek.
Approximately 50 per cent of the salaried employees will be terminated effective Dec. 31, 2014 resulting in estimated severance costs of approximately $1.7 million. Endako has 347 total employees - 84 are salaried and 263 are hourly.
“The remaining 50 per cent of salaried employees will remain employed for the time being,” said Solly.
On Dec. 10, all hourly employees were provided 60-day work notices and will be paid through Feb. 7, 2014. According Solly, the company cannot estimate how long the suspension will last for.
“We will continue to closely monitor market conditions and re-evaluate the status of the mine as market conditions warrant,” she said.
Thompson Creek continues to operate Mount Milligan, its open pit copper/gold mine north of Fort St. James. Solly said that Thompson Creek will make an effort to transfer some of the workers at Endako Mine to the neighbouring mine.
“If there are positions available at our Mount Milligan operation, we would certainly look to place interested and qualified Endako employees in those positions,” she said.
“This is devastating news for Fraser Lake, especially just before the holiday season,” said Fraser Lake Mayor Dwayne Lindstrom. “The suspension impacts more than 350 employees and their families here in Fraser Lake; our thoughts are with them at this time.”
Lindstrom said that in the coming day, the Fraser Lake council will meet with representatives of the province, Regional District of Bulkley-Nechako and other community leaders to “find ways to limit the impacts on the workers, their families and Fraser Lake.”
Jacques Perron, president and chief executive officer of Thompson Creek, said the company expected that the operational improvements that were implemented in 2014 would have been sufficient to keep the Endako Mine operating profitably during this prolonged volatility in the molybdenum market, but as a result of the current and expected molybdenum price weakness in the near term, they have no other option but to place the mine on temporary suspension.
“We would like to express our gratitude to our employees, joint venture partner and all stakeholders during this challenging time,” he said.