On May 3, Boliden announced a breakthrough agreement between worker’s unions and local management to resume operations at Ireland’s largest mining operation, the Tara zinc mine near Navan, on a more sustainable financial footing. The Tara mine, Europe’s largest zinc mine and a global leader, was placed in care and maintenance in July 2023 due to challenges such as declining zinc prices, high operational costs, and logistical issues.
The new agreement includes an optimized mining plan aimed at reducing transportation distances and maximizing metal output, with an initial annual production target of 1.8 million tonnes. It also involves a comprehensive organizational overhaul, including workforce reductions and enhanced operational efficiencies. These measures are expected to lower the mine’s cash cost to approximately $1/lb of zinc, down from $1.37/lb in the first half of 2023. Improved energy price outlooks and lower treatment charges are contributing factors.
However, the restructuring process will incur one-time costs of approximately EUR 30 million, impacting the second quarter of 2024. Combined with previously announced care and maintenance costs of EUR 13 million per quarter, this will result in an estimated operating loss of EUR 43 million for the quarter. The restructuring involves reducing the workforce to around 400 full-time equivalent employees, down from over 600 during the care and maintenance phase, alongside significant organizational and procedural changes. Employees will gradually return to work starting in the third quarter of 2024, with a structured onboarding and retraining program.
Production ramp-up is scheduled to begin in the fourth quarter of 2024, targeting full production by January 2025. Anticipated operating losses for the second half of 2024 are estimated at approximately EUR 25 million per quarter, compared to EUR 13 million during the care and maintenance period. Concurrently, exploration efforts aimed at the Tara Deep deposit will recommence in the latter half of 2024, aligning with the decision to reopen the Tara mine.
