Core Lithium, an Australian miner, is conducting a strategic review of its business activities and has halted operations at its Finniss project near Darwin with immediate effect.
The review is being conducted in response to the 85% drop in spodumene concentrate prices over the past year.
The company will instead process existing ore stockpiles. By processing stockpiles, it plans to reduce its operational costs while still generating revenue.
This will help preserve its ability to restart mining when the market recovers.
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The reduction in operations could result in the culling of nearly half of the 300 jobs at the mine, ABC News reported.
Core Lithium has around 280,000 tonnes of ore stockpiles as of last month, enough to be supplied to the concentrator until mid-2024 without further mining.
One of the pits at the mine will be maintained for a potential ramp-up in operations if the market recovers.
The company has also suspended the BP33 early works construction project in order to conserve cash.
Despite this, significant progress has been made, including the completion of the box cut excavation and the start of tunnel arch footing installation. The site will now enter into a care and maintenance phase.
Core Lithium CEO Gareth Manderson said: “The team has moved at pace to ensure Core’s value is preserved in these tough market conditions. While suspending mining operations is a difficult decision, processing of ore stockpiles will continue to generate revenue and we will focus on managing our cash reserves prudently. We are working to put the business in the best position possible to recommence mining and proceed with BP33 when market conditions improve.
“The Northern Territory Government has been a supportive partner, and we remain committed to finding a path forward for the Finniss operation and the Territory community. We understand that this decision is difficult for employees, contractors and some local businesses.”