Talvivaara says taxpayers won't pay for clean-up

Crisis-hit Talvivaara Mining Company says taxpayers will not have to shoulder the clean-up cost at its nickel mine in eastern Finland.

Speaking overnight to Finnish broadcaster Yle's current affairs programme A-studio, Talvivaara Chief Executive Harri Natunen promised that the gypsum pond leak at the mine would be its last and that they are fully insured for it should they not be able to pay.

Natunen reportedly did not agree that Talvivaara may have to file for bankruptcy and refused to speculate on how long the company could stay afloat with production stalled.

On November 8th it gave investors some much-needed cheer after saying that it expects its fourth-quarter production to improve over the levels seen in the third.

However, the group warned that as a result of the "challenging water balance situation" it is currently experiencing, it believes it is unlikely that its full-year 2012 production target of approximately 17,000t of nickel will be achieved.

Talvivaara reported third-quarter net sales of €44.8m compared to €60.6m in the same period in 2011. In the nine months to the end of the third quarter sales totalled €117.3m (2011: €164.7m).

Quarterly losses widened to €12.1m (Q3 2011: €3.4m) while nine month losses leapt to €44.5m (2011: €8.9m).

Expenditure in the three-month period totalled €32.5m (Q3 2011: 22.0m), the debt-to-equity ratio hit 140.6% (Q3 2011: 128.1%), while net interest bearing debt came in at €514.6m (Q3 2011: €410.2m).

CM