Australia’s zinc mine of the Century to close

Australia will see the country’s largest zinc mine close in 2016.

Chinese owned MMG made the announcement yesterday, citing a natural end to the operation's resource.

However speaking at the Lowy Institute the day beforehand company chief executive Andrew Michelmore did level “a high dollar and a high operating cost environment coupled with lengthy approval and permit regimes” as making ti harder to continue to do business at mines such as its Duglad River operation.

Michelmore said the current environment is “impacting project returns". 

Century is the world’s third largest open cut zinc mine, and according to the ABC the move to shut the operation is the first ever closure of a base metal mine of this size in the country.

Located in north-west Queensland, the Century zinc mine is due to run out within the next three years and the rehabilitation process is already underway, with the company adding that it will take around 120 years for the pit void to fill with water.

The company said it will also make attempts to minimise the effect the mine’s closure will have on surrounding communities and is currently evaluation options to further utilise existing infrastructure at the site.

MMG’s Queensland general manager said removing infrastructure would be a last resort.

"We're looking at a number of options, we're looking at phosphate business, some of the small mines that exist around Century and looking at reclaiming our tailings dam.

"All of those are fairly low level of confidence studies at the moment, but certainly at the end of this year we'll have a fairly good idea about where they're going to sit."

Closure Planning Superintendent, Matt Lord told the ABC returning the site to its original condition could take a number of years and warned the 340-metre pit will never be completely rehabilitated.

"We will allow that pit to fill with water from the natural ground water and we'll also speed up the process by pushing some of our evaporation water back into the pit,” Lord said.

"But the modelling we've done to date suggests it will probably take around 100 to 120 years for that pit to reach it's maximum level which will still be at least 20 metres lower than the surrounding topography."

Lord explained rehabilitating the waste areas is going to be the most challenging task.

"The waste areas are probably the more challenging area because they're a constructed land form, it's easier to rehabilitate areas that have simply been disturbed because we can just reduce compaction and replace the topsoil and seed that with the appropriate seed mix,” he said.

"With these constructed land forms, the intent is to make sure that the mineralised waste that’s stored within them doesn't come into contact with the environment and produce poor quality water.”

MMG is still researching ways to properly seal the tailings dam, and reiterated it is committed to the long-term rehabilitation of the site.

“We seriously can't walk away until both ourselves and the regulator and our other stakeholders are satisfied that we've done what we said we'd do,” Lord said.

"The areas down on the flats with the black soil should eventually be suitable for cattle grazing, so the most likely outcome is that the Lawn Hill Riversleigh Pastoral Holding Company will look to put cattle back in here.”

Australian Mining yesterday reported the future of the company’s nearby Dugald River Mine also remains uncertain.

MMG made the decision to terminate its engineering, procurement, and construction contract with Forge at its Dugald River mine's processing facility.

According to the miner "complexities in the Dugald River project's ore body have been identified, prompting a review of the planned mining method".

"To focus resources on the mine method review and manage short term capital expenditure, the company has decided to suspend most earthworks at the project site. This includes ongoing engineering, procurement and construction of the processing facility for the Dugald River project."

MMG gave Forge notice of the decision on Wednesday afternoon, and will officially terminate the contract on September 26.

Additional surface work such as the construction of the permanent accommodation camp and bulk earthworks has also been suspended.

MMG stated that "the review of the Dugald River project is expected to be completed by the end of 2013".

"Accordingly a final investment decision regarding the development of the Dugald River project will only be made once this review is completed."

The Dugald decision places redeployment options for Century’s 1000 employees up in the air, with the ABC reporting many of the workers at Century could be laid off in the next two years.

MMG is obliged to monitor the Century mine for 30 years after mining ceases.

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