Reuters reported that investors lured by high commodity prices are returning to the once lucrative British mining industry but they face challenges ranging from financial backing to local opposition.
A few old mines have reopened and other projects are on the drawing boards in the UK where the industry in its 19th century glory days was the world's largest tin producer and was the largest employer in the country.
Rising costs and lack of rich, shallow deposits led to the demise of the industry but the commodities boom in recent years has spurred a rethink by investors. While the number of potential revived mines is modest it can still provide a much needed boost to local economies by creating additional jobs in a still struggling UK economy.
Mr Ken Jones marketing manager for Clogau Gold which previously owned the rights to the mine said that one set of investors want to revive what was Britain's largest gold mine in Wales, the Clogau Gold Mine or the Clogau St David's Gold Mine. When we closed the mine it had become too expensive to sustain it but with the rising price of gold we are potentially looking at reopening the mine, either alone or in partnership. Over the past 12 years spot gold prices have surged more than sixfold from about USD 250 per ounce in 1999 to a record peak of USD 1,578.50 an ounce.
Clogau Gold, a Welsh jewellery firm has run into obstacles in its efforts to reopen the mine in Bontddu facing competition from an unnamed overseas firm for the rights to mine gold from the site. The gold mine in Wales has been the source of the British royal family gold and the ring for Kate Middleton's wedding to Prince William earlier this year was sourced from the mine.
Investors have also been looking to reopen what was the UK's largest tin mine in Cornwall which was once the world leader in tin production and had around 2,000 mines. The South Crofty mine the last operational tin mine in the UK was closed in 1998 after years of struggling with low tin prices.
Benchmark tin prices on the London Metal Exchange have soared more than fivefold from a low of around USD 6,000 per tonne in 2005 to USD 33,600 per tonne in April. The mine owners, Western United Mines had been attempting to reopen the mine for the last few years but faced opposition from local authorities which wanted to redevelop the site into a leisure center.
A source close to the company said that the mine will be tentatively opening in 2013 to 2014 as the deal has been cleared by local authorities. The company is in talks with an overseas investor to finance the next phase of the project.
The Health and Safety Executive spokesman said that there have also been proposals to reopen the tin and silver mines at Parys Mountain in Anglesey in Wales but the developers are still looking for financiers to back the scheme.
Industry sources said that even mines which have been shut for over 60 years are having renewed interest. A tungsten mine in Hemerdon in south western England is gearing up to reopen for the first time after it was closed during World War Two in 1944.
(Sourced from Reuters)
