A combination of global financial pressures and the toll of competing with unscrupulous minerals trading in Central Africa has forced Talison Minerals to sacrifice up to 200 jobs by closing its Wodgina tantalum mine in the Pilbara, Talison chief executive Peter Robinson told MINING DAILY.
According to Robinson, as demand for consumer goods has decreased the demand for tantalum has decreased along with it, making companies reluctant to place new orders.
“Those guys are in a situation where they don’t know what’s going to happen with the world economy,” he said.
“They want to sit back and wait and see what happens.
“They really don’t want to renew contracts at this stage.”
The situation is made worse by the corrupt way tantalum is handled in Central Africa, particularly the Democratic Republic of the Congo, Robinson said.
“You’re talking about the traders, also about the militia in those areas,” he said.
“A lot of the mining operations are controlled by the militias, and if not, the material is taxed and transportation is taxed as it moves through areas that are controlled by the militias.
“A lot of the money is siphoned off by the militias and goes, we hear, into funding the armed conflict that’s going on in that part of the world.”
According to Robinson, this combination of a tightening market and cheaper minerals being available to those who will still buy is what has forced Talison’s hand at Wodgina.
“The Chinese in particular have been buying more and more material out of Central Africa at relatively low prices in order to build up their inventory,” he said.
“You have the militias wanting to sell more materials so they can get revenue, and you’ve got the Chinese wanting to build up their inventories in China ahead of the supply demand balance and the expectation that prices are going to go up.
“The supply side has increased, and the demand side has decreased.”
The jobs that will be lost as a result of the closure are a combination of contractors and permanent staff, Robinson said.
“We’re suspending mining and we are cutting right back on processing as well,” he said.
“It’s a mixture of contractors associated with the mining operation, and our own people who are associated with processing and administration.”
Robinson is disappointed with the closure and hopes that the company can ultimately resume operations at Wodgina.
“We have the capacity and the desire to continue,” Robinson said.
“We are retaining a skilled group up there that will be sufficient to restart the operation if and when the world returns to normality.”
The company’s lithium production at its Greenbushes site will remain unaffected by the cuts.
“From Greenbushes we are also producing something like 25% of the world’s lithium,” Robinson said.
“As we stand at the moment demand seems to be holding up pretty well.
“We’re a very big player in that market.”