North American Palladium has finally restarted pgm production at its flagship Lac des Iles (LDI) mine, it was confirmed yesterday (14th April).

The company decided to put the facility - which is located in Ontario, Canada - on care and maintenance in October 2008 amid declining pgm market conditions.

However, operations have now resumed as palladium, which is predominantly used in catalytic converters for cars, has increased by over 200 per cent since the end of 2008.

"The restart is well timed to capitalise on the recent increase in the price of palladium, which now exceeds $520 per ounce," noted the firm.

North American Palladium, which hopes to produce 140,000 oz of palladium this year, also confirmed that it has renewed its smelting contract with Xstrata, the diversified Anglo-Swiss miner.

Under the terms of the new deal, the Canadian company will receive advance payments of 70 per cent within 60 days of the completion of the month when concentrate is delivered.

Matthew O'Keefe, an analyst at Cormark Securities, explained in an interview with Reuters that both moves are likely to improve North American Palladium's cash flow.

Meanwhile, North American Palladium also said ore production at LDI's Roby Underground zone will increase from 2,000 tonnes per day to 2,600 tonnes per day by 1st May.

Commissioned in 2001, the mill at LDI uses conventional flotation technology to produce a palladium-rich concentrate which also contains platinum, nickel, gold and copper.

Source:

UPDATE 2-North American Palladium restarts palladium mine (14/04/10)

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