Ivanhoe mines operations shut down in Burma

Asiantribune.com reports that
Canadian Friends of Burma (CFOB) revealed that Vancouver-based Ivanhoe
Mines ceased production at its copper mine near Monywa, Burma on March
30 2006, according to its annual report issued on Monday.

The company cited expected decreases in production, inability to import
additional mining equipment, and an additional 8% tax imposed on copper
exports from Burma. The company also said that it is concerned about
timely approvals for the expansion of the Letpadaung deposit.

Ivanhoe Mines was operating in Burma on the basis of a joint-venture
with Burma’s state-owned Mining Enterprise No.1 (ME-1); the biggest
mining company operating in Burma.

It invested USD $150 million in mid-1990 and an additional USD $390
million was planned to invest in the expansion of Letpadaung project,
located six miles southeast of the existing Ivanhoe-operated mine in
Burma.

The company’s stated ambition was to increase annual production to
200,000 tons of copper within four years, making it one of the largest
copper mines in the world.

Until recently, Ivanhoe Mines has made steady profit - more than $25
million each year – from the existing S&K Mine. It stands out as
one of the most profitable foreign operations for Ivanhoe, and was once
considered the pearl of their mining empire. Ivanhoe has also
diversified and entrenched its investments in Burma by partnering in
ventures such as the Modi Taung gold project, holding 65% of its shares.

CFOB expressed it believes that the social, political and economic
situation in Burma is not stable enough to secure both the
profitability and security of foreign investments. The shutdown of
Ivanhoe’s operations in Burma sheds light on how difficult it is to do
business in Burma in the absence of a coherent rule of law and enforced
regulations in the country.

- Asian Tribune -

EDIT from an Ivanhoe investor:

The mine is already running again. Also they are selling 25% of their share in the mine for US120 million dollars.

(from mongolia.neweurasia.net)

 

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