TORONTO (Reuters) - Thompson Creek Metals Co Inc TCM.TO said on Wednesday that slumping demand has pushed it to cut about 100 jobs at its namesake molybdenum mine in Idaho as it suspends stripping for the mine to reduce costs, sending its shares down more than 6 percent.
The Denver-based miner said it is stopping stripping, the process of removing overlaying earth, at Phase 8 of its Thompson Creek mine to try to save $100 million in operating costs, plus up to $9 million in capital costs, between now and 2014.
If stripping is not resumed before 2015, the mine will be mothballed.
“As a result of continuing weakness and uncertainty in the world economy, we have decided to reduce our costs, strengthen our balance sheet, and conserve cash,” said Chief Executive Kevin Loughrey in a statement.
Loughrey added that company’s primary focus is construction of its $1.5 billion Mt Milligan copper mine in British Columbia, which is the main cog in Thompson Creek’s diversification strategy.
Operations at the Thompson Creek mine will continue as planned through 2014, with the project producing about 20 million-22 million pounds of molybdenum in 2013 and 17 million-19 million pounds in 2014.
Molybdenum is primarily used in steelmaking, an industry that has been hit hard in recent months by slowing growth in China and by the European debt crisis.
Thompson Creek’s stock slid 6 percent to C$2.47 shortly after the market open on Wednesday on the Toronto Stock Exchange. Shares have fallen more than 65 percent this year, as the company has been hammered by cost overruns, operational hiccups and falling metal prices.
Reporting by Julie Gordon; Editing by Peter Galloway