Mt Gibson suspends mining at Koolan

Mining at Mount Gibson Iron’s Koolan Island main pit in the Kimberley has been suspended, after a slump on Friday resulted in an area of instability in the seawall.

Mount Gibson said in a statement today that the area was evaluated over the weekend and it expects it will take around four weeks to repair, with four shipments from Koolan Island expected to be delayed from the December quarter.

The company said no employees were at risk and all mine workers from the main pit had been redeployed to other scheduled mining activities.

Mount Gibson chief executive officer Jim Beyer said he expected the impact of the interruption to be short term.

"Bringing forward and accelerating activity planned for later in the year at other parts of the mine, including the Acacia East pit, will help offset downtime in Main Pit while we complete remedial work in the affected area," Mr Beyer said.

Despite the delay, Mount Gibson maintained its full-year sales guidance of 6.6 to 7 million tonnes, which is down from its 2014 results of 9.7 million tonnes.

Last years' higher sales were due to the company selling additional ore that it had stockpiled from 2012 when sales from the mid-west were affected by rail constraints.

The four-week suspension of mining in the main pit will result in a delay in the pit’s cut-back stage, as it won’t be able to conduct the high-level movement of materials as planned.

The company now operates two mines, after it closed its Tallering Peak hematite mine last quarter after 10 years of operation.

Koolan Island accounts for more than half of the company’s iron ore shipments, with the remaining 3mt of the 2015 forecast coming from the Extension Hill project in the Mid West.

Mount Gibson shares were trading at 47 cents at 1.30pm WST, down around 4 per cent.