Flooding disrupts CopperCo’s Lady Annie Mine
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The Receivers and Managers for CopperCo Limited (ASX:CUO) - Gary Doran and David Lombe, from professional services firm Deloitte Touche Tohmatsu - advise the suspension of mining activity at CopperCo’s Lady Annie mine site in Queensland, following record rainfall and significant flooding.
The adverse weather conditions currently being experienced in North West Queensland have had a significant impact on production at the mine, located 120 km north of Mt Isa. Flooding and subsequent damage has prevented normal access to site, and severely impeded mining operations.
As a result, all mining activity at the mine has been suspended and 68 employees have been stood down from today, until further notice.
Since 1 December 2008, more than 1060mm of rain has fallen on the site including 183mm in 24 hours on 8 February 2009.
“The necessary repairs to restore operations to normal levels cannot properly commence until the weather and conditions improve and as a result, we have been forced to suspend operations,” Mr Doran said.
For employees at the Lady Annie operation, this is not a termination of employment, and employee entitlements will continue to accrue as normal.
The Receivers and Managers have also made arrangements to obtain funds from the Company’s financier to make payment to employees that are being stood down for their annual leave entitlements, which were outstanding at the commencement of the Receivership (up to a maximum of two weeks leave).
The recent flooding levels have exceeded the design capacity of the site stormwater ponds, which were designed to retain a one in one hundred year “two month wet season runoff” event before overflow.
Water flows external to the plant site have eroded a section of the retaining wall on one side of the southern storm pond and created a breach of the wall. This has allowed water to flow under the plastic liner and has resulted in some minor liner damage in this pond. Two separate discharge events have occurred and have been reported to the Queensland Environmental Protection Authority as per licence requirements.
The Company’s insurers under storm damage and business interruption policies have been advised of the events.
For further general information on the voluntary administration and receivership process, please refer to: www.asic.gov.au/insolvencyinfosheets