Two days after Ottawa shutdown plans for an $814 million copper-gold mine near Williams Lake, the proponent has slashed 65 jobs.
Vancouver-based Taseko Mines Ltd. (TSX:TKO), an affiliate of the privately-held Hunter Dickinson mining group, said Thursday morning it cut the jobs as a result of the federal government’s decision not to approve the company’s proposed Prosperity mine.
“This represents the unfortunate impact of the federal decision on Tuesday,” said Taseko president and CEO Russ Hallbauer. “The seriousness of the situation is heightened considering that a third of these positions were in the Williams Lake area, which already suffers from high unemployment levels.”
On Tuesday, the federal government shot down Taseko’s plans to build Prosperity saying it would cause significant adverse environmental effects to Fish Lake, a body of water that would have to be drained because it sits next to the planned pit (See “Ottawa blocks Taseko Mines’ plan for Prosperity ” – BIV Business Today, November 3).
The decision slammed Taseko’s stock Wednesday, which saw a 31% drop to $4.49 in trading yesterday morning.
Ottawa’s move to block the mine was also a major blow to the provincial government and Gordon Campbell, who had actively supported the project before he announced his resignation Wednesday.
On the other side, the Tsilhqot'in National Government, First Nations groups and environmentalists lauded the federal government’s decision to protect Fish Lake.
Still not all hope for the project has been lost.
Toronto-based Franco-Nevada Corp. (TSX:FNV) said Wednesday its US$350 million deal to help fund Prosperity in exchange for 22% of its eventual gold output "remains available to Taseko once the project is fully permitted and financed.”
Hallbauer said Thursday the company has initiated discussions with federal and provincial governments to identify how the project might move forward despite Ottawa’s decision.
At press time, Taseko’s shares were trading at $4.76.