Company plans to reduce operating rates at Brule and Wolverine.
Shares of Western Canadian Coal Corp. (TSX: WTN, Stock Forum) fell 4.7% to $1.02 early Tuesday, after the company announced that it is planning to reduce operations at its Brule mine and the Wolverine operation.
The company says it expects its Brule mine in British Columbia, which produces low-volatile PCI coal, to be operating at an annual run rate of approximately 750,000 tonnes per year effective at the end of this month, down from its current run rate of 1.3 million tonnes per year.
The Wolverine operation, which produces primarily hard-coking coal and is currently operating at an annual run rate of 1.6 million tonnes of coal per year, has given notice to employees that it may curtail operations effective May 18, subject to market conditions for the next coal year, says the company.
The reduced operating rates are reportedly a result of rising inventory levels as some customers defer shipments through the next few months.
"I emphasize these plans are contingent on what the demand of metallurgical coal will be for the next coal year. Whether we reduce operations and to what levels, will depend on the demand for our coal. We hope this will become clearer in the coming months. Until then, we continue to focus on working safely, increasing productivity and lowering costs to remain competitive through these difficult times," says John Hogg, the company’s president and CEO.
At the end of November, Western Canadian Coal temporarily suspended mining operations and future capital expenditures at its Willow Creek Mine.
On the Western Canadian Coal Corp. Bullboard this morning before the news was released, 2fast4you said: “Stay tuned folks, it could be an interesting day today. ;) [sic]”
