Nyrstar Extends Port Pirie Lead Smelter Force Majeure

Base Metals Investing

An unplanned production outage at Nyrstar’s Port Pirie lead smelter has dragged its heels once again with a new extension to the end of July.

An unplanned production outage at Nyrstar’s (OTC Pink:NYRSY,EBR:NYR) Port Pirie lead smelter has dragged its heels once again with a new extension to the end of July.

In early June, the company declared force majeure at the South Australian asset due to an unplanned delay in restarting the blast furnace after a planned shutdown. According to Nyrstar, a steam eruption in Port Pirie’s refinery caused the delay, along with a failed blast furnace water jacket.

“The further extended Blast Furnace outage now requires a partial dig out of the Continuous Drossing Furnace, essential for treatment of all lead output from the Blast Furnace, as it has now fully solidified,” a release from Nyrstar reads.

While the company had originally anticipated that the blast furnace and top submerged lance furnace would restart at the end of June, Nyrstar subsequently extended the outage to the second week of July.

No reason was given, though the company acknowledged the “material negative impact” the shutdown would have on Port Pirie’s production and underlying earnings before interest, tax, depreciation and amortization.

In a fresh release put out Tuesday (July 9), Nyrstar stated that the force majeure will continue until the last week of July. The company notes that it is still working to establish the impact of the outages, but will give further information no later than its H1 2019 results release.

An integrated multi-metal recovery plant, Port Pirie is one of the largest primary lead smelting facilities in the world and is the third largest silver producer, according to Nyrstar. The company has been working to convert the smelter’s operations into an “advanced metal recovery and refining facility,” with the redevelopment carrying a AU$714 million price tag.

Nyrstar’s share price remained at 0.19 euros in Brussels on Tuesday, where it has stayed since June 24.

As of Tuesday, lead was trading at US$1,883 per tonne on the London Metal Exchange.

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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.

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