Phelps Dodge Takes Action To Cut Power Costs

Compiled By Travis Hessman Phelps Dodge Corp. has announced actions it will take to reduce power-related costs at its U.S. mining operations. The Phoenix-based company expects to curtail production at portions of its Chino, N. Mex., operation at least through the remainder of the year. Also, Phelps says it will institute 30- to 60-day alternating production curtailments at its Tyron, N.Mex., operation, as well as at its Sierrita and Bagdad operations in Arizona. Unrelated to electricity costs, the company also plans to reduce molybdenum production at its Henderson operation in Colorado. These decisions will reduce the company's 2001 copper production by 175 million pounds and molybdenum production by 7 million pounds. To further manage electricity costs, Phelps has negotiated a 60-megawatt firm power contract and has begun construction of a 40-megawatt co-generation power plant in New Mexico. The new facility is scheduled to be operational by August. Due to the curtailment, the Chino operation will lay off or reassign about 130 employees. Changes in economic conditions, including molybdenum and copper prices, could alter the timing and length of the curtailments.

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