|End-of-day quote - 07/28|
CAP : Minería Press Release
|12/18/2015 | 01:58pm|
Due to the recent and serious decrease in the price of iron ore in the international market, together with the high cost of energy, through the present CAP Minería informs that it has decided on an additional rationalization of its operations in the Copiapó Valley (Magnetite Plant), and the Elqui Valley (El Romeral Mines), with the purpose of reducing the negative effects of these price drops on results and cash flows.
The following is a detail of these production rationalizations:
- A temporary two month (January and February 2016) production stoppage at the Magnetite Plant located in the Copiapó Valley, without stopping primary concentrate production operations, in order to face plant operations at a greater rate during 2016. Previously planned maintenance programs will also take place during this temporary stoppage.
- A partial suspension of production operations during the months of January and February 2016 has been declared for the El Romeral and Puerto Guayacán Mines located in the Elqui Valley. During this period of time only preconcentration production operations will take place in order to face 2016 on better footing, depending on market conditions.
In order to implement these measures the Company has taken the precaution of maintaining stocks towards the end of the 2015 fiscal year due to better production levels that those originally planned. This will allow the Company to meet its commercial commitments without any problems during the 2016 fiscal year.
It is important to mention that the aforementioned set of measures will not significantly affect the total production projected for the 2016 fiscal year.
As indicated, the goal of these measures is to mitigate the adverse effects caused by the drop in prices, and we are sure that they will allow us to adequately face this period. Notwithstanding the foregoing, the effectivity of these measures will be permanently reviewed according to the evolution of prices in the international iron ore market.
December 18, 2015.
CAP SA issued this content on 2015-12-18 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 2015-12-18 18:57:09 UTC
Original Document: http://eng.cap.cl/featured/cap-mineria-press-release/