Hillsborough Resources Ltd., a private mining company based in B.C., has announced it is suspending operations indefinitely at its Quinsam coal mine in Campbell River.
“Due to a prolonged and steep decline in thermal coal prices, changes in market demand and policy disincentives, Quinsam Coal cannot operate economically and will suspend coal production indefinitely,” the company said in a press release.
That’s five coal mines that have shut down in B.C. in the last two years, thanks to a prolonged global glut and low prices for both thermal and metallurgical coal.
The Quinsam coal mine has operated since 1987. The thermal coal it produced served a niche market – the cement industry, which uses it not just as a fuel, but also as a feedstock, as the ash, silica and alumina from burned coal are some of the key ingredients of cement.
As a result of putting the mine into care and maintenance, the company’s 66-person workforce will be “reduced significantly,” the company said.
The Quinsam coal mine is Hillborough’s only operating mine. It had one other project it was trying to develop – the Echo Hill project near Tumbler Ridge – but that was put on the back burner.
Hillsborough Resources CEO David Turnbull said the company will continue to ship coal from its inventory to meet its contractual commitments in 2016. Turnbull said the mine is being put up for sale.
“There may be certain parties that are more interested in a mine that’s in suspension than ongoing operations in an environment like this, so they have the option of bringing it up when the market improves,” Turnbull said. “And there is cyclicality, clearly.”