Canada-based company Prophecy Coal on Thursday said it had temporarily
suspended mining since July at its Ulaan Ovoo coal mine, in Mongolia, owing to
its 187 000 t stockpile being enough to meet contractual obligations to the end
of the year.

The company said about 80 mining employees were laid off and paid severance
of about $100 000 each to comply with local employment laws.

Only 15 staff members remained on site for equipment and site maintenance,
shipping and security operations during the shutdown.

“With little local employment competition, the local labour force is
expected to remain available for prompt rehire when needed,” the company said
in a statement.

The shutdown is expected to last for about six months but could end sooner
if any significant new coal sale agreements were entered into. Start-up could
be effected in a matter of weeks.

Prophecy said it was using the downtime to work with Mongolian officials to
seek road and bridge improvements, and to open the Zeltura border to facilitate
Russia export sales.

The overall effect of the suspended operations would only be “modestly”
cash-flow positive as Ulaan Ovoo operations had not yet achieved break-even
levels.

The company”s priority was to conclude Chandgana power plant joint venture
discussions.

miningweekly.com