Low prices force RTZ to close mine

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The Independent Online
PERSISTENTLY low prices for silver, lead and zinc have forced RTZ Corporation to stop production at its 54 per cent-owned Greens Creek mine in Alaska. RTZ's 1992 profits will be hit by an exceptional charge of pounds 32m.

RTZ also intends to make a further exceptional charge of pounds 20m to cover restructuring at Indal, a Canadian subsidiary supplying the construction sector. RTZ shares slumped but partly recovered to close 6p lower at 650p. Emil Morfett, mining analyst at the brokers Smith New Court, welcomed the announcements.

'It is good to see RTZ displaying a healthy attitude to the question of closure rather than subsidising a loss-making operation. This is good news'.

He is forecasting after-tax attributable profits for RTZ of pounds 307m for 1992 against pounds 308m after a rise in exceptional charges from pounds 46m to pounds 62m. The charge in 1991 was for accelerated depreciation on a copper smelter.

Prices of silver, lead and zinc have been under severe pressure as a result of the recession and the arrival in western markets of significant amounts of base metals from the former Soviet Union.

Last month Pasminco, in which RTZ has an indirect 15 per cent stake, announced closures and restructurings at its Broken Hill mining operation in Australia.

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