By Sybille de La Hamaide and Dominique Vidalon
PARIS (Reuters) -French miner Eramet, which on Wednesday suffered heavy stockmarket losses after it suspended operations in Gabon in response to an ongoing coup, said manganese mining in the country would resume on Thursday.
“In view of the information available this evening on today’s events in Gabon, the group has decided to immediately restart rail transport activity and to resume mining operations as of tomorrow morning”, it said in a statement.
Eramet’s Gabon mining activities make it the world’s largest producer of high-grade manganese ore for steelmaking. The halt sent shares in the company down by about 17% in Paris daily stockmarket trading.
“The group is continuing to monitor the situation in Gabon closely and will keep the markets informed”, Eramet said in a statement released at 1630 GMT.
Earlier on Wednesday, a group of senior Gabonese military officers appeared on television and said they had taken power after the state election body announced President Ali Bongo had won a third term.
Eramet’s manganese operations, led by its Comilog unit operating the Moanda mines in Gabon, were the main contributor to the company’s profits last year.
The Gabonese government holds a 29% stake in Comilog.
Manganese is the fourth most widely used metal in the world, after iron, aluminium and copper. Steel production uses 90% of manganese consumption.
Eramet has manganese alloy processing plants in France, Gabon, Norway and the United States.
Morgan Stanley estimated that Gabon produces 8.5 million tonnes of manganese ore – 14% of global supplies – of which 7.5 million tonnes are from Eramet and 1 million from unlisted players.
Nicolas Montel, analyst with BNP Paribas’s asset management subsidiary Portzamparc, said a prolonged suspension would be felt on the market, although the group was unlikely to pull out of Gabon altogether where costs are among the lowest in the world.
In terms of company profits, he added that the impact of the suspension of operations could be mitigated if it led to any rise in the price of manganese, which is not traded on an exchange but is assessed by price rating agencies.
(Reporting by Sybille de la Hamaide; additional reporting by Dominique Vidalon, Gus Trompiz in Paris, Nathan Vifflin in Gdansk, Felix Njini in Nairobi and Ernest Scheyder in Houston; Editing by Ingrid Melander, Tassilo Hummel, Barbara Lewis and Richard Chang)