Molycorp Silmet: Fire has impact on company's results

BNS
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Photo: Matti Kämärä / Põhjarannik

Molycorp Silmet AS, Estonian subsidiary of the NYSE-listed Molycorp Inc, has said the fire at its plant in Sillamae on Tuesday will have an impact on the company's results because it is not possible for it to produce rare metals at full capacity now.

«Of course it will, because we are not able temporarily to produce rare metals at full capacity,» Molycorp Silmet AS chairman of the board David O'Brock said in his answer to a question from BNS on Wednesday.

He said that while the company hasn't added up the damage yet, they hope that disruption in manufacture as far as the process that used to take place in the affected building is concerned will last for a short time. «Our engineers are working to find a temporary solution to the problem,» O'Brock said.

O'Brock said shareholders have confirmed that a new production line to replace the one that suffered in the fire will be built shortly. Until that has happened the company will give the workers of the affected production  line work elsewhere in the plant because there's high demand on the market for tantalum and niobium this year, he added.

In the affected building a part of the manufacturing process of tantalum and niobium took place that continued in other buildings. The fire did not affect Silmet's plant of rare earth metals, where work continues as usual. Of the rare metals plant only that part of the manufacturing process is disrupted that took place in the affected building.

«We will wait until the investigation is complete. At first sight it can be said that the building which caught fire has been completely destroyed and everything that was inside it sustained damage,» O'Brock told BNS.

A fire at a five-story factory building of Molycorp Silmet in Sillamae, northeastern Estonia on Tuesday spewed out toxic fumes and rescuers asked residents to stay indoors. No injuries to workers or residents of the area have been reported. Paramedics checked the health of three firemen who reported having suffered minor health damage and allowed two of them back to work.

Molycorp closed at 0.42 dollars at the New York Stock Exchange (NYSE) on Tuesday.

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