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Category: Mining Industry

Grange Resources plays down $285m Savage River mine loss

Wednesday, 2 Mar 2016 05:15:32

Grange Resources says savings can be made at its Port Latta pellet plant. (Rose Grant)

Grange Resources has played down the impact of a write-down of nearly $285 million on the value of its Savage River iron ore mine on Tasmania's west coast.

Despite the mine returning a $50 million profit for the year to December 2015, the devaluation of its assets under falling iron prices helped put the company $278 million in the red.

Grange Resources chairwoman Michelle Li told ABC Rural the company still had a strong cash flow.

"Not really very much a factor for us, cash flow, and company business-wise, it's not affecting our business and operations," she said.

In January, the Chinese-owned company announced 55 jobs would be shed from its 600-strong Tasmanian workforce due to the falling iron ore price.

But no further cuts were expected as a result of the write-down.

Ms Li said the company would try to reduce costs by investing in new technology.

She said improvements could be made at the company's pellet plant at Port Latta.

"We still need to control the cost, and also we're doing other developments," she said.

"For example, we're looking into new flux pellets machinery.

"Although our pellets are really good quality, the technology being used is 40 to 50 years old."

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