Copper Mines of Tasmania has picked Henty Gold Mine operator PYBAR Mining Services to do a major upgrade of the veteran Queenstown mine’s main decline.

The project to rehabilitate 4.4 kilometres of the decline is expected to cost several million dollars.

It will be funded from a  $9.5 million state government package aimed at helping to clear the way for a mine re-start.

Mining has been on hold after three mine deaths in two incidents in 2013 and 2014.

A return to Mount Lyell  production would create an estimated 300-plus direct jobs when it reached its peak.

CMT mine general manager Peter Walker said: “This work is essential to bring a relatively old decline up to modern ground support standards and we are confident PYBAR will do this work safely and on time.”

“The state government funding that is making this work possible will enable a start of the D Panel block cave to occur without delay once a re-start decision is made.”

He said CMT was continuing with re-start studies to optimise mining and processing options and hoped the studies would be finalised soon.

“In the meantime, we will continue with the early works under the funding package and dewatering the mine,” he said.

Braddon Liberal MHA Joan Rylah said PYBAR Mining Services would look to ensure Queenstown and surrounding areas benefited from the works.

“I understand that maximising the number of jobs for locals is a key focus and I look forward to these jobs commencing,” she said.

”Our investment in Mt Lyell is creating jobs, with about 50-60 new jobs in construction as a result of the projects we are funding, and a re-start of production at the Mount Lyell Mine could create up to 300 direct jobs.”

Mrs Rylah said the government wanted the mine open again because it would provide employment and economic benefits to Queenstown and the West Coast.

Mr Walker said CMT would work closely with PYBAR to maximise benefits to Queenstown where possible.

PYBAR chief executive Brendan Rouse said: “We are delighted to be working with CMT to rehabilitate the Mount Lyell decline.”

“With our ongoing work at the Henty Gold Mine, we look forward to expanding our presence in the Queenstown region.”

CMT owner Vedanta has spent about $100 million on development of a new block caving mining method, environmental projects, exploration and rehabilitation since the mine went onto care and maintenance after mining halted in January 2014.

Mr Walker said addressing water drainage issues in the longer term would also reduce government exposure to legacy environmental issues from operations under previous ownership.

He said CMT currently employed about 35 people and the government-funded work had potential to create 50-60 extra jobs for up to six months.

The decline is used to bring ore to the surface.