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UPDATE 2-BHP, Oz Minerals cut copper output after Australia power outage
September 29, 2016 / 2:32 AM / a year ago

UPDATE 2-BHP, Oz Minerals cut copper output after Australia power outage

* BHP shuts Olympic Dam mine after power outage

* Minerals also halts copper mine

* Port Pire lead smelter down (Recasts, add details of more closures)

By James Regan

SYDNEY, Sept 29 (Reuters) - A power outage in South Australia has halted more than 300,000 tonnes of annual copper production capacity and knocked out the Australian state’s only lead smelter, producers said on Thursday.

A massive blackout in South Australia on Wednesday forced BHP Billiton to suspend production at its Olympic Dam copper mine to divert back-up power to maintain essential operations at the remote site.

A BHP spokesman did not say when operations would resume at the mine, which produced 203,000 tonnes of copper in fiscal 2016, or about 13 percent of company-wide output.

The outage also brought Oz Minerals’ Prominent Hill mine, which is forecast to produce up to 125,000 tonnes of copper in concentrate this year, to a halt, a spokesman said.

He also could not say when operations would restart.

“Production has been put on hold until further notice,” the spokesman said.

Nyrstar NV said its 185,000-tonnes-per-year Port Pirie lead smelter will be out of action for up to two weeks.

London lead futures climbed to the highest since May last year over supply concerns.

A back-up diesel generator at the smelter kept the furnace going for several hours when power was cut to the entire state yesterday.

But repairs to a blast furnace, damaged when power was lost and slag solidified, could result in the company losing “three to five million euros”.

“It is expected that the blast furnace will be down for approximately 10 to 14 days for repairs,” Nyrstar said.

Severe storms and thousands of lightning strikes knocked out power to the entire state of South Australia on Wednesday.

A BHP spokesman said back-up generators were providing power to critical infrastructure but a full restart of operations will only occur when full power is restored.

It was too early to determine if BHP would seek legal protection from supply obligations under a declaration of force majeure, he said.

The blackout happened after strong winds destroyed major power lines north of the state capital Adelaide and lightning struck a power plant, causing a surge across the grid. The network and link to neighbouring Victoria state shut down to prevent damage to infrastructure, causing a state-wide outage. (Reporting by James Regan; Editing by Shri Navaratnam and Ed Davies)

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