IMX Resources is believed to be closing its iron ore mine at Cairn Hill near Coober Pedy, with at least some workers already having left the site.
InDaily understands employees were told of the closure yesterday, the same day IMX requested that the Australian Securities Exchange place its securities in a trading halt session state “pending the release of an announcement”.
A spokesman for IMX was unable to confirm what was happening at the mine, but said a statement would be made before Friday as required under ASX rules.
A recent fall in iron ore prices to 2012 levels of $US89 per tonne has seen shares in Australian iron ore miners fall heavily, causing apprehension in the industry. At the end of last week, iron ore fell US60c.
IMX operates and owns 51 per cent of the Cairn Hill mine through a joint venture with Taifeng Yuan Chuang International Development Company Limited.
According to the company’s website, shipments from the mine were originally forecast to end in February 2015. However, in April this year, IMX announced it would extend operations through to mid-2015.
At the time, IMX acting managing director John Nitschke said that Phase 2 was “a logical, low-risk extension of the Cairn Hill Mine which made sound economic sense”, adding that it formed part of a broader strategic vision to extend the life of the mine.
The mine had been producing enough ore for two full shipments a month to China.
A spokesperson for the SA Department for Manufacturing, Innovation, Trade, Resources and Energy told InDaily this morning it was unable to provide further information about the mine’s operation until an announcement was made to the ASX.
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InDaily understands that mine employees were told that the iron ore price was so low that the company could no longer cover its operating costs at Cairn Hill.
