Miners were told the layoffs are a result of the recent energy crisis combined with the low market prices of molybdenum, a mining byproduct that is a metallic chemical element used to harden steel. It has many industrial uses.

J. Steven Whisler, Phelps Dodge's chief executive, told the media that the California power crisis has forced Phelps Dodge to scramble to supply diesel fuel at some facilities. The rising price and limited availability of electricity along with the higher costs for diesel fuel and natural gas have affected the production costs of molybdenum.

Phelps Dodge is the world's second-largest copper producer. According to the Wall Street Journal, this move is the "most drastic reaction by heavy industry to steeply rising energy prices" so far.

The Tucson Citizen quoted Robert Wishart, president of Phelps Dodge Sierrita Inc., as saying that global production competition and a glut of molybdenum has driven the price from $8 to $9 a pound in the mid-1990s to about $2.19 a week ago. Profits from the Sierrita, Chino, and Tyrone mines are suffering as a result.

Wishart claimed the miners took the news of the closure well and called the mood of the workers downbeat but resolute. However, a resident of the mining area told Militant reporters that the layoffs "will hurt everyone around here. Phelps Dodge is good at that. Look at what they did at Clifton and Ajo," referring to the company's breaking of the union, with the help of the National Guard, in 1984 at the two copper mines in Arizona.  
 
 
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