South African mining company Exxaro Resources Ltd. (EXX.JO) said Thursday that in the next six months it will decide what to do with its Zincor zinc refinery business, which stopped production in December on account of it becoming uneconomical.

The company tried to sell Zincor before stopping production, but didn't receive any offers.

Exxaro said it was shutting the operation due to energy shortages in South Africa and because electricity cost increases made it too expensive to carry on.

Exxaro's finance director, Wim de Klerk, said that the miner is considering three main options--close the site completely, find a buyer or process leftover feed stock for minerals.

Zincor processes about 240,000 metric tons of zinc concentrate a year, and about 25% of its total sales are to the South African unit of ArcelorMittal (MT).

Energy shortages and price rises have put a strain on businesses in South Africa. This month, Xstrata PLC (XTA.LN) said it will idle five of its chrome furnaces in the country until the end of May due to energy shortages, following a request by the main electricity provider, Eskom Holdings Ltd.

-By Devon Maylie, Dow Jones Newswires, +27 11 783 7848; devon.maylie@dowjones.com

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