Dec 5 (Reuters) - Thompson Creek Metals TCM.TO slashed its capital expenditure budget and postponed the completion of an expansion project at its Endako Mine, hurt by a drop in molybdenum prices.
Capital spending in 2009 is expected to be $69 million, down from the company’s prior view of $300 million.
Thompson Creek, the world’s No. 5 molybdenum miner and the top pure producer of the steel-hardening agent, has been hurt by cuts in steel production as the global economy slows.
Molybdenum prices have tumbled to levels near $10 a pound from more than $30 as recently as October. Forecasters and producers say the slump could last at least for the next year.
The company, which owns a 75 percent stake in the Endako mine in British Columbia, also said it estimates its share of expansion capital expenditures in 2008 for the mine at about $37 million.
The postponement of the Endako expansion is the second such step taken by Thompson Creek to reduce planned capital spending.
The Toronto-based company said in November it would postpone development of its Davidson project in northern British Columbia until economic conditions improve.
Thompson Creek backed its 2008 operational outlook for molybdenum sales of 22 million pounds and molybdenum output of 25 million to 26 million pounds
The company also reiterated its 2009 molybdenum production view of 31.5 million to 34 million pounds, but said it could adjust 2009 production plans if market conditions worsened.
Shares of the company closed at C$3.45 Thursday on the Toronto Stock Exchange. The shares have lost more than 80 percent of their value in the past year. (Reporting by Adveith Nair in Bangalore; Editing by Mike Miller)