The owner of the Caribou Mine in northern New Brunswick has suspended the extraction of all minerals at the site while it reviews its operations.
Trevali Mining Corp. announced Tuesday it would explore all options for the future of the mine near Bathurst after reporting low productivity rates and a steep drop in revenue.
In an email Wednesday, Jason Mercier, Trevali's director of investor relations, confirmed the decision to halt production.
The news comes after the Vancouver-based company released its second-quarter financial results, which showed it recorded a 44 per cent decrease in revenue compared to the previous quarter.
Trevali said it wouldn't be able to meet a deadline today to pay a $7.5 million debt to one of its lenders.
The company blamed the financial results partially on the Caribou Mine, citing "operational performance issues" and low productivity rates. It also says it suffered a loss of $15.2 million following flooding at its mine in Burkina Faso.
The Caribou Mine is located about 50 kilometres west of Bathurst and produces zinc, lead and silver. It employs over 200 people.
Mercier said Trevali plans to only keep employees conducting tasks "related to current work status" of a suspension. He did not say how many layoffs have been made.
"This decision is not a reflection of the team at Caribou — they have worked hard to improve the mine's position and we appreciate their dedication," he said.
Bathurst Mayor Kim Chamberlain was not available for an interview, but said in a statement she is greatly concerned about the impact of the suspension.
"Having such a high number of workers, who, overnight, find themselves out of work without having any understanding of the future prospects at this site is most worrisome," she said.
The Caribou Mine has temporarily closed and reopened multiple times in the past in response to fluctuation in market prices for minerals.
In 2020, production was halted at the mine after zinc prices plunged during the pandemic. Then in February 2021, the company restarted operations.
Chamberlain said people in the region are resilient and she is awaiting more details from Trevali about its plans for the mine.
"It is just disheartening that the present individuals presently impacted must demonstrate the same resiliency in order to maintain their livelihood," she said.
Economic ripple effect
People in the Bathurst region warn that a prolonged suspension of operations at the mine could have a ripple effect on the local economy.
Minerals extracted were brought by trucking companies to the Port of Belledune, where it is stored in leased facilities and then shipped to Quebec by rail.
Denis Caron, the port's CEO, said local subcontractors involved in the supply chain and CN Rail will lose business.
"Over the years unfortunately we've a lot of industries in the northeast that were using the rail system, and it's always a challenge to maintain rail," he said.
"Of course for any port you have to be connected to the road system and the rail system as well so that is of concern."