Ann: Quarterly Activities Report, page-7

FYI

Nov 8 (Reuters) - Zinc prices touched their highest in more than a month on Wednesday on the back of supply concerns after a fire hit a large Russian mine operation in the wake of recent mine suspensions.


Three-month zinc on the London Metal Exchange (LME) gained 1.8% to $2,613.50 a metric ton by 1700 GMT, the highest level since Oct. 2. A fire was extinguished on Wednesday at Russia's Ozerny mining and processing plant and the company was assessing the possible impact on the planned start next year of full-scale operations at the country's largest zinc deposit, a spokesperson said. Morgan Stanley this month said that Ozerny, also known as Ozernoye is expected to produce 350,000 tons of zinc a year.

"This is potentially a very bullish development for the zinc market, as it (Ozernoye) is scheduled to become one of the largest zinc mines in the world," said Dan Smith, head of research at Amalgamated Metal Trading.

"There has already been a lot of talk about mine closures and how close the price is to the cost floor."

Nyrstar last week said it planned to close two U.S. zinc mines temporarily at the end of November because of weak prices and the impact of inflation - the third shutdown of zinc operations by producers in recent months. Adding to supply concerns, LME zinc inventories have more than halved since early September.

The zinc market is a bit like musical chairs at present imo - probably the reason we can't get a JV to commit to the Citronen project but hopefully things will stabilize and we get the timing right to get things up and running!
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