Doubts about whether the Mount Lyell Mine will reopen are growing after a state government ordered the closure of a copper smelter in India.
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The Tamil Nadu government ordered Mount Lyell owner Vedanta Resources to permanently close its Tuticorin smelter, citing environmental grounds.
The smelter was where Mount Lyell copper was sent when the mine was in production, and would have taken its copper if the mine reopened.
The veteran Queenstown mine has been on care and maintenance since 2014, following three workplace deaths in two incidents.
Vedanta has been working towards a potential resumption of mining, and an announcement was expected this year.
A restart would be expected to create more than 300 West Coast jobs over time.
“ ... we continue to evaluate various options for its profitable restart, given the current favourable government support and prices,” Vedanta said in a financial report in May.
The order to close the Tuticorin smelter followed police shooting 13 protesters dead on May 22.
The Tamil Nadu government also cancelled the sale of land for a proposed expansion of the smelter.
Vedanta is likely to appeal the closure order, but that might be a lengthy process.
According to the Economic Times, the chief executive of Vedanta’s Sterlite Copper division said Indian manufacturers which relied on the smelter would have to turn to imports.
Vedanta also smelts copper in Zambia.
As well as its problems in India, UK-based and Anglo-Indian Vedanta has come under pressure internationally, with critics of its environmental record including British Labour’s Shadow Chancellor, John McDonnell.
Comment was being sought from Vedanta subsidiary Copper Mines of Tasmania and the state government.
The government had committed $9.5 million for projects to aid a potential restart of the mine.
It also offered a $25 million financial assistance package in 2015 to CMT to reimburse payroll tax and royalties over five years from when the mine reopened.
Shadow Resources Minister Shane Broad said: “What is the (Resources) Minister (Guy Barnett) doing to facilitate the restart of the mine given that the package of support was announced a year ago?”
On May 24, CMT’s Mount Lyell general manager, Peter Walker, said: “CMT is committed to working towards a safe restart of operations and the creation of more jobs at Mt Lyell.”
Mr Walker said the events at Tuticorin were not connected to operations at Mount Lyell.
That was before the Tamil Nadu government’s smelter closure order.
