Cliffs Natural Resources Inc has ended production at its Bloom Lake iron-ore mine in north-eastern Quebec, as the biggest US producer of the raw material exits higher cost operations to focus on its domestic business.
The mine has been put into care-and-maintenance status and the last shipment of iron-ore out of the Port of Sept-Iles will be completed in early January
Cliffs has also closed the sale of some West Virginia coal mines
Mr Lourenco Goncalves, Chairman and CEO of Cliffs said that “We have brought to an end the flawed expansion that has cost Cliffs and its shareholders billions of dollars. The sale of the West Virginia coal operations also demonstrates our ability to execute complex transactions despite an adverse M&A environment.”
Cliffs sold the Logan County Coal assets to Coronado Coal II LLC for USD 174 million in cash and the assumption of certain liabilities. It expects a tax benefit of 20% to 25% of the previously disclosed pretax loss of about USD 400 million, a benefit of USD 80 million to USD 100 million in future tax savings, Cliffs said. The company will record the results of the sale in its fourth quarter earnings.
Cliffs said in November that it was considering closing the Bloom Lake mine after deciding an expansion plan wasn’t viable, three years after buying the operation in a USD 4.3 billion takeover. The company estimated closing costs would be as much as USD 700 million over five years.
Source – Bloomberg
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