25/03/2015 – Pilbara iron ore miner BC Iron pushes ahead with cost cuts

 

BC IRON is pushing ahead with its cost cutting efforts after signing a new mining contract at its Nullagine joint venture in WA.

The Pilbara iron ore miner has lowered its all-in cash cost target to $47 to $51 per wet metric tonne, down from $54 to $61, after awarding a mining and crushing contract to Viento Contracting Services for the Warrigal hub.

“Our contracting strategy is key to our 2015 cost reduction efforts and it is pleasing to achieve meaningful savings for the Warrigal hub,” BC Iron managing director Morgan Ball said.

“The pricing and competitiveness seen in the tender process provides comfort that further cost savings can be achieved.” He said the company would reassess its main mining, crushing and screening contract and road haulage contract in the second half of 2015.

BC Iron has recently been cutting costs, including dozens of jobs, after falling iron ore prices and production issues pushed the company to a $97 million half year loss.

The junior miner said capital expenditure for full year 2015 is expected to remain within its guidance range of $13 million to $16 million.

The Warigal hub contract provides for the mining and crushing and screening of around two million tonnes per annum of Warrigal ore for two years starting in April 2015.

Viento will provide and operate load, haul, crushing and screening equipment, and operate a second-hand surface miner that the joint venture will purchase from Fortescue for $1.8 million. Last month BC Iron said its average realised price for iron ore fell 39 per cent from a year ago.

The price of the steel-making commodity is trading at a six-year low of around $US55 per tonne.

Shares in BC Iron lifted one cent, or 2.4 per cent, to 42 cents at 1450 AEDT.

 

Source – PerthNOW.com.au