Finnish mine struggles to fix leak, high uranium found

HELSINKI Fri Nov 9, 2012 5:29pm GMT

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HELSINKI (Reuters) - Finnish nickel miner Talvivaara said on Friday it was still trying to fix a waste water leak at its mine in Sotkamo, eastern Finland, which resulted in high levels of uranium in nearby waters.

Uranium more than 50 times higher than normal levels were found in streams this week near Talvivaara's nickel and zinc mine, according to nuclear safety officials, although they said they did not see any risk to public health. The ore from the mine also contains uranium.

Talvivaara shut down production at the mine on Sunday after discovering the leakage, the latest in a series of problems at the site over the past year including environmental concerns and the death of a worker in March.

The company announced early on Friday that it stopped the leakage, but later said that another leak had occurred and it was working to fix it.

Local authorities denied it permission to restart the plant on Friday, blocking the company's earlier plan to get it back online by the weekend.

Its London-listed shares fell nearly 15 percent to 103.5 pence, while those on the Helsinki bourse fell 14.5 percent to 1.30 euros.

Talvivaara, which pioneered the use of bacteria to extract nickel, said it now needs to reconsider its target of producing more nickel in the fourth quarter than in the previous quarter.

But even before the week's problems, the company was already struggling with low production and weak nickel prices. Talvivaara has cut its annual nickel production target twice this year, blaming heavy rainfall for disrupting production.

In the third quarter, it swung to a quarterly operating loss of 4.3 million euros compared to a profit of 5.5 million euros a year earlier.

(Reporting by Terhi Kinnunen; Writing by Ritsuko Ando; Editing by Jon Hemming)

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