The weight of plummeting molybdenum prices proved too heavy to haul for Chevron Mining, as the company gave pink slips to 227 mine and mill workers Wednesday.

The 54 percent cut leaves Taos County's largest private employer with 185 employees, primarily underground miners who will work one of two shifts bringing ore rock to the surface.

It also creates a large hole in the sobering employment picture of the region — and idles as many as 100 residents of Questa after their final pay check in 60 days.

The Englewood, Colo., company's strategy keeps the mine open and operating, on an limited basis, in hopes of a quicker-than-usual turnaround in the commodity price of the steel hardener.

The plan is to stockpile ore from the current ore block, and "pause" development of another underground ore block and a restart of open-pit mining, operations manager Phil Howard said. The mill will operate on an as-needed basis because, he said, "we want to have product to sell after this is over."

But no one, including Chevron Mining's new chief executive, Fred Nelson, could say when the molybdenum spot price will come back enough to begin rehiring.

As of Feb. 12, the price for a pound of gray, slippery molybdenum oxide was $8.85, according to Roca Mines. The price has soared as high as $40 since 2001, and stayed in the $30s until last summer, when it began a speedy slide to its present levels.

"The prices have dropped 70 percent since summer," Nelson told the attentive audience that filled the Red River Convention Center. "The cost of mining is higher than what we can get back, and we expect demand to be low for the near term.

"We are keeping the mine and mill open with a core work force for operations and reclamation so that we can respond quickly to changes in commodity markets," he said. "But we need a reduction in work force to 185."

The work-force reduction comes on the heels of the dismissal of some 75 contract workers, many of whom were working on a new underground production area.

Out on the job hunt again

Expecting bad news before they arrived at the Red River Convention Center, many of the 183 laid-off nonsalaried union workers were philosophical about the job cuts.

"It was a surprise (the size of the cut) to everybody," said Pat García of Questa. "At least they came and said to us straight."

All around, workers commiserated with each other.

"I'm gone," said one. "Gone fishing, I guess."

When asked if he still had a job, another worker replied, "They cut my crew. That's all I need to know."

Many recalled previous big layoffs at the former Molycorp facility, like the 1986 shutdown that idled 750 workers and the 1992 price collapse that prompted Molycorp to close up shop and flood the mine's shafts.

"They did it a lot different last time," said 25-year veteran Virgil Martínez of Cerro, who will stay on. "They did it the right way this time. But we still have to look after one another more now."

Others bumped fists to show their support for their fellow crew members. Most took advantage of coffee and doughnuts, courtesy of their employers.

Layoffs among salaried staff, which made up about 90 of the 412-employee work force, will total 44, said company officials, and be determined in the next couple of days.

Few of the laid-off hourly workers seemed to know where the next paycheck could be found.

"It's a hard thing," said Raymond Pacheco, a 6 1/2-year worker who got laid off. "Maybe some schooling, but I have to support my family."

Local union officials worked the room before and after the announcement, answering questions about pay and benefits — and the future. All laid-off employees get two months' pay and benefits — required by federal law — plus incentive pay for those with at least two years on the job. Contract provisions call for transition counseling and job search help.

The mine chapter of the United Steelworkers' of America has set up a members' meeting at 4 p.m. today at the Questa Fire Department, to explain any options for out-of-work members.

"It's bigger than we thought," said union president Veto Vialpando of Questa. "I hope a lot take up the schooling, get education for something else. But right now, we're in shock."

All hourly workers got manila envelopes with lists of both laid-off and retained workers — and new duties, for the latter. Layoffs went generally by seniority per department, according to mine manager Phil Howard, although some departments were cut more than others.

Company officials announced that personal belongings may be picked up at the mine at 8 a.m. today and Friday.

Hard times ahead

In an interview after the meeting with The Taos News, mine manager Howard said Chevron Mining, which recently acquired the mine as part of a deal with Unical, has "given us an ability for more sustainability" to keep the mine open, for the time being.

"This is a tough one all around," said Howard, who rose from the ranks of union maintenance worker to assume the mine's reins a couple of weeks ago. "I worked with these guys. I know them. It's a multigenerational work force."

Several laid-off workers came up to Howard after the meeting to shake his hand.

"This is stressful for me," he said.

Howard would not say how much the price must rise before re-hiring would begin.

Chevron Mining's other mines include coal mines in McKinley County, N.M.; Kemmer, Wyo.; and North River, Ala. All of them continue to operate, according to company officials.

"Unfortunately, moly is a commodity," Howard said. "Like a switch, the demand fell off from the steel industry. In one quarter. That's fast. And it's the same for copper and other commodities.

"We were holding out for some spark of good news," Howard said. "It just didn't come."

Contact Andy Dennison at adennison@taosnews.com.