UPDATE 2-Rio Tinto unit says Bingham Canyon slide worse than expected

Fri Apr 12, 2013 4:44pm EDT

* Kennecott says experts not yet granted access to the mine

* Refining, smelting continued as of early Friday

* Impact on operations, time frame to resume still unknown

April 12 (Reuters) - A landslide at Rio Tinto's Bingham Canyon mine in Utah extended further into the pit than predicted, and there was greater damage to equipment than previously estimated, Rio's Kennecott unit said on Friday.

Kennecott Utah Copper, which operates the mine that is near Salt Lake City, said it had not yet determined the impact of the slide, which occurred late on Wednesday, or a time frame for resuming mining operations.

Photos published by Salt Lake City's Deseret News show debris extending from the top of the massive pit mine to its floor, slicing through terraced roads and burying trucks. []

"The size of the slide was significant," the company said in an emailed statement. "We don't have information yet regarding the magnitude or impact. We do know that the flow into the pit extended beyond the scenarios we forecasted, having a greater impact on equipment."

The company said on Thursday that all employees were accounted for and safe.

In its latest statement, Kennecott said there had been some damage to equipment and to a building structure in the mine. It said experts had not been granted access to the mine.

Landslides can seriously disrupt operations at open pit operations. Lundin Mining Corp resumed production at its Aguablanca nickel-copper mine in Spain nearly two years after heavy rains caused a slide there.

A note on Kennecott's website says the mine's visitor center will not reopen in 2013.

STILL SMELTING, REFINING

Justin Jones, a spokesman for Kennecott, said earlier on Friday that Bingham Canyon was still producing copper from stockpiled material. Jones could not say then how long the smelting and refining process could continue, and that was still being assessed.

"The mine itself is very large, and there are possibilities that we can begin starting portions of the mine, you know, within a few days, thus not interrupting the production of copper," he said.

Kennecott is the second-largest copper producer in the United States, and Bingham Canyon, one of the world's largest open pits, produced 163,200 tonnes of copper last year, as well as 200,000 ounces of gold.

In a note to clients, BMO Capital Markets analyst Tony Robson said that on a provisional basis, he expects between 80,000 and 160,000 tonnes of copper could be lost this year, and production could be affected in 2014 and 2015 as well.

Rio said last June that it would invest $660 million over the next seven years to extend the life of the mine to 2029, from 2018.

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