North American Palladium (NAP) has laid off 44 employees at its Lac des Iles Mine 90 kilometres northwest of Thunder Bay.
In a statement, the company blamed “weak metal prices” for the move. The eliminated positions include 18 staff and 26 unionized positions; an additional 17 vacancies will not be filled, resulting in a net reduction of 61 positions, the company said. After the reductions, the company will employ 422 workers.
Tied to this reduction is the decision to stop blending the low-grade surface stockpile with the higher grade underground ore and return to a 14 day on, 14 day off operating schedule for the mill at a planned throughput of 13,400 tonnes per day when the mill is operating. The surface stockpile at less than one gram per tonne palladium is not economic at current prices.
"It is unfortunate that we have had to take this step at this time," said Jim Gallagher, NAP president and CEO, in the release.
"It is imperative that we maintain a positive cash operating margin and continue our focus on sustainable long-term operation of the underground mine and on our exploration program,” Gallagher added. “These cuts, along with the corporate office reductions that took place in August after the financial restructuring, will help us achieve these goals."
Due to the reduction in low-grade material being processed and the impact of the temporary mill shutdown earlier this year as a result of water balance issues, the company is revising its 2015 guidance to 160,000 to 170,000 ounces of palladium produced, down from the previously announced 185,000 to 205,000 ounces, the release said.
