VANCOUVER, British Columbia , Sept 13 (Reuters) - The Gibraltar copper mine in British Columbia is on track to be reopened in October, owner Taseko Mines Ltd. (TKO.V: Quote, Profile, Research) said on Monday of the small operation that was shut down in 1998 when copper prices were too low to keep it going.
A 70 percent increase in the price of copper since early last year has meant that the open pit mine near Williams Lake in south-central British Columbia, like other higher cost copper producers, can be revived.
Gibraltar is expected to produce 70 million pounds (31,751 tonnes) of copper and 980,000 pounds (445 tonnes) of molybdenum in concentrate a year.
Prices for molybdenum, mainly used to rustproof steel and stainless steel, are trading around record highs. Copper prices are off the 8.5 year highs of earlier this year but still healthy as demand continues to outstrip supply.
Taseko director Scott Cousens said the construction of a refinery, which will help to cut costs at Gibraltar, was still under investigation.
Brokerage First Associates said last month a refinery would cost about C$110 million ($85 million) to build. It also said Gibraltar's average cash cost to produce a pound of copper would be 90 cents a lb, but that an own-refinery might be able to cut this by 20 cents a lb.
Gibraltar has signed a four-year copper concentrate sales contract with Glencore, a Swiss-based metals buyer.
Taseko, part of Canada's Hunter Dickinson group of mining ompanies, bought Gibraltar in 1999.
($1 = $1.30 Canadian)
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