SASKATOON—Potash Corporation of Saskatchewan Inc. is halting production indefinitely at its Picadilly Mine is southern New Brunswick.
The fertilizer producer plans to put the mine on care-and-maintenance, leading to the loss of 420-430 jobs.
“This is a very difficult day for our employees and our company,” PotashCorp president and CEO, Jochen Tilk, said. “While these are important steps in running a sustainable business and positioning the company to best meet the needs of its many stakeholders over the long term, such decisions are never easy.”
As its rationale for the decision, PotashCorp said the closure will allow it to shift production to its lower-cost potash operations in Saskatchewan and cut costs while it faces a “challenging macroeconomic backdrop.” The suspension follows the permanent closure its nearby Penobsquis, N.B. mine in Nov.
The company said the move will eliminate $50 million in capital expenditures in 2016, as well as $135 million in 2017/18.
PotashCorp plans to continue employing a core crew of 35 workers to maintain the mine on care-and-maintenance. It noted if it decides to reopen the mine, the process would take about one year.
Meanwhile, the suspension will be effective immediately.
As some consolation for the job losses, the company said more than 100 jobs at its Saskatchewan operations will be available to its Picadilly employees willing to relocate. PotashCorp also plans to establish a $5 million community investment fund to help former employees transition.
“We are committed to making this transition the best it can be under the circumstances. Employees who do not remain at Picadilly or who choose not to relocate to Saskatchewan will be provided severance and assistance packages,” the company said.