Simon Dupere, president and CEO of Quebec-based LAB Chrysotile, said in a telephone interview with The Canadian Press that he's confident many of the 350 jobs at the mine will be saved.
"It's not an operation that is overstaffed," Dupere said. "Is it going to be a little more or a little less? That depends on what works, it depends on the business plan."
Dupere said the company's current financial situation made it impossible to continue operations.
He said the shutdown of its Lac d'amiante du Canada mine in Thetford Mines last fall didn't stem costs and there has been no revenue to deal with them.
Declaring bankruptcy is a key step to getting the financially troubled company back on a solid financial footing.
"We have a structural problem," Dupere said. "We have a problem with fixed costs and this will be resolved with the (bankruptcy).
"Now we will talk to everyone involved, we will see how we're going forward and how'll we'll revive the project."
One possibility that would allow the mine to resume production in 2013 would be the opening of access to an asbestos deposit that is currently blocked.
While workers were surprised by the bankruptcy announcement, the union says the possibility of a recovery provides a ray of hope.
But Gordon Ringuette, a spokesman for the mine's union, says he's waiting to see if the company will use the situation to seek concessions from workers to reduce labour costs.
"We expect that they will ask for concessions," Ringuette said. "They're talking about a business plan that has become too expensive and unprofitable.
"I'd like to remind them that in 2005, at the last contract negotiations, workers left 25 per cent in monetary concessions on the table. Twenty-five per cent in concessions on wages, vacation pay, benefits. It's huge."
Dupere said last summer the operation was plagued with internal problems including labour, production and development issues.
The shutdown at Thetford Mines followed a production halt at the cash-strapped Jeffrey Mine in Asbestos, about 90 kilometres away, bringing Canada's once-mighty asbestos sector to a halt for the first time in 130 years.
Jeffrey Mine needs a bank-loan guarantee from the Quebec government before it can start digging a new underground mine.
The asbestos sector has had to fend off a growing group of international critics made up of health experts and activists.
The Canadian Cancer Society says more than 100,000 people die worldwide every year from occupational exposure to asbestos and a growing chorus of health experts have repeatedly called on Canada to stop exporting the mineral.
They want politicians to permanently close the Canadian industry, which ships the bulk of its asbestos to poorer countries where they argue safety standards are too weak.
Defenders of the industry credit it for creating hundreds of jobs in the economically depressed region of central Quebec, a point the Conservatives have tried to translate into votes.
But a Natural Resources Canada memorandum, released to The Canadian Press last year under the Access to Information Act, estimated that the life of Quebec's Lac d'amiante du Canada would end in early 2012.
The Conservative government has steadfastly refused to let asbestos be added to an international hazardous-chemicals list — a United Nations treaty known as the Rotterdam Convention.
The long-held position of the Tories, and other asbestos industry supporters, is that it's safe when handled properly.
Quebec Natural Resources Minister Serge Simard declined to comment on the bankruptcy and his media spokesman called the company's move a business decision.