Econintersect: One of the world's largest open pit mines is not removing any new material from the ground after a massive earth slide two weeks ago. The Bingham Canyon Mine in Utah (20 miles southwest of Salt Lake City) has been closed indefinitely after a portion of the wall collapsed into the nearly 3 mile wide, 3/4 mile deep pit on April 11. According to Reuters the mine produced 163,000 tonnes of copper and 200,000 ounces of gold in 2012. This mine produced 17% of the copper mined in the U.S., but only about 1% of global production.
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The mine is owned by Kennecott Utah Copper, a subsidiary of Rio Tinto (NYSE:RIO), which has seen its stock fall from $48.20 (close for 11 April 2013) to as low as $43.19 intraday 17 April. Since then the stock has rebounded to close at $46.10 24 April.
The massive earth slide was actually not a surprise. The company had detected accelerated earth movements since February and had been monitoring the risk of a slide since. There were no injuries in the event because heightened risk had been noted 4 days before the slide and personnel removed from the pit. There were damages to expensive equipment that had been left in the mine because the slide was much larger than expected and equipment thought safe was buried.
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Because of the risks the mine visitor center was not opened in 2013. From the Kennecott Utah Copper website:
Due to slope movement of the northeast wall at Kennecott Utah Copper’s Bingham Canyon Mine over the winter, the Visitors Center and overlook plaza will not reopen as scheduled on April 1. Plans are underway to provide an educational opportunity for Utahns and tourists in 2014.
There is still uncertainty about when mining operations in the pit will resume. The company said that copper production will continue for some time processing stockpiled material. Some of the statements sound optimistic that the mine will not suffer significant production losses. But some assessments are more pessimistic. From Reuters:
In a note to clients, BMO Capital Markets analyst Tony Robson said that on a provisional basis, he expects between 80,000 and 160,000 tonnes of copper could be lost this year, and production could be affected in 2014 and 2015 as well.
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John Lounsbury Hat tip to Roger Erickson.
- RPT-UPDATE 2-Rio Tinto unit says Bingham Canyon slide worse than expected (Reuters, 14 April 2013)
- Inside a mile-deep open-pit copper mine after a catastrophic landslide (Tim Heffernan, boingboing, 22 April 2013)
- Visitors center (Kennecott Utah Copper web site)