Polish KGHM warns may suspend some projects amid low copper prices

Fri Aug 14, 2015 12:21am EDT
 
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WARSAW Aug 14 (Reuters) - Europe's No.2 copper producer, Poland's KGHM, may postpone or suspend some investment projects if prices of the metal remain at current low levels in the long term, the company said on Thursday.

The state-run firm also said it may need to review its investment spending and be forced to lower its production assets value if low prices of copper and silver persist.

KGHM said it would be obliged to run asset impairment tests if the ratio of its market capitalisation to net asset value fell below 0.8 in the long- term, which it defined as more than a year.

Last month, the company's chief executive said it did not plan any impairments on its copper projects this year, as it was getting a boost from a weak peso and the zloty.

This week, three-month copper on the London Metal Exchange hit a six-year low of $5,062 a tonne, which KGHM sees as its "pain level". (Reporting by Agnieszka Barteczko; Editing by Clarence Fernandez)