Company looks to resume operations at Climax molybdenum mine
July 22, 2011
LEADVILLE – Freeport McMoRan Copper & Gold Inc. is looking to restart operations at the historic Climax molybdenum mine next year, CEO Richard Adkerson said Thursday.Hundreds of contract workers have been involved in a $700 million project to get the mine reopened.The mine in Leadville has been on maintenance status since 1995. It shuttered in 1987 after molybdenum prices plummeted. Freeport acquired Climax and the Henderson molybdenum mine near Empire in 2007 when it bought Phelps Dodge Corp. Freeport’s work to reopen Climax stalled as prices faltered for molybdenum, which is used in steel production, but mine operations are now slated to start next year.”We’re very excited about that,” Lake County Commissioner Mike Bordogna said. “We don’t want to be overly optimistic, but we do feel it’s a very encouraging sign.”Adkerson told analysts in a conference call that the company expects to phase in production at Climax with about 10 million pounds in 2012 and increase to about 20 million pounds a year by 2013.Phoenix-based Freeport hired miners for Climax last year and is now looking to hire operators, he said.About 160 people work at the mine now, and about 185 more will be hired for operations, maintenance, technical and administrative positions to begin production at the 20 million pound per year rate, Freeport spokesman Eric Kinneberg said. That could give dozens of residents a chance to work and live in Lake County instead of commuting to jobs in Eagle or Summit counties, Bordogna said.”That has economic impacts but social impacts as well. Families will be able to be around for everything from their kids’ games to volunteering in community,” he said. Freeport is banking on growing demand for molybdenum as China and other growing Asian nations build infrastructure and housing.Argus Research analyst Bill Selesky said technology has improved in the past two decades to allow Freeport to extract more ore from the Climax mine, which is designed for a capacity of 30 million pounds of molybdenum annually and could be expanded. Climax opened in 1918 when steel demands were high during World War I. It once employed about 3,200 people as one of the world’s largest underground mines.Leadville’s mining history stretches for more than 130 years, leading to waste that put residential areas of Leadville and Lake County on the Superfund cleanup list in 1983. The Environmental Protection Agency is reviewing whether to remove those areas from the national list.Bordogna said it appears the new owners of Climax share the community’s interest in environmentally responsible mining.