TORONTO, Aug 19 (Reuters) - Shares of embattled Canadian miner Imperial Metals Corp slid nearly 4 percent on Tuesday, due to worries about delays at its Red Chris copper project in British Columbia and concerns about higher capital costs.
The miner has been caught in a storm this month following a major spill of mine waste at its Mount Polley copper and gold mine, also located in the same province in Western Canada. While costs of the cleanup are still unclear, some analysts say the costs could range from C$50 million to C$500 million.
The accident has stretched an already-tight balance sheet and Imperial last week said it was raising about C$100 million ($92 million) in debt to cover cleanup costs and finish building its new Red Chris mine.
On Thursday the company reported quarterly results and said it was expecting capital costs at Red Chris to rise by some C$60 million. On a conference call on Monday, Imperial gave analysts more details on the delay in a power line to the mine, along with some clarity on the regulatory clearances still needed for the mine to begin production.
"The capital expenditure increase is unwelcome, especially in the light of the Mount Polley dam failure," said BMO Capital Markets analyst Sasha Bukacheva in a note to clients.
She believes that while the additional funding provides some immediate financial relief to the company, it may not be enough depending on the ultimate remediation costs at Mount Polley and further delays to Red Chris.
M Partners analyst Derek Macpherson expects commissioning of the new Red Chris mine to be pushed into the first and second quarters of 2015, from an earlier expectation of late 2014 to early 2015. He had earlier expected commissioning of the mine to occur in fourth-quarter 2014 and first-quarter 2015.
Macpherson, who has a "hold" rating on the stock, trimmed his price target on Imperial's shares to C$9.50 from C$10, in a note to clients on Tuesday.
On Monday's conference call, the company said it is in negotiations with its insurers, but is still not clear how much insurance money it is likely to receive in the wake of the Mount Polley disaster. Imperial said it still uncertain on how much the cleanup at the site will cost.
TD analyst Craig Hutchison said: "We are concerned about the future costs and liabilities associated with the Mount Polley cleanup and the potential implications on the company's ability to permit a future expansion at Red Chris."
Imperial Metals shares were down 3.6 percent at C$9.81 on the Toronto Stock Exchange at midday on Tuesday, after falling as much as 6 percent earlier in the session. ($1 dollar = 1.0926 Canadian dollars) (Reporting by Euan Rocha; editing by Matthew Lewis)