(Kitco News) - Yesterday, Monarch Mining (TSX: GBAR) announced that it has suspended operations at the Beaufor gold mine due to financial and operational challenges.
The company said that the mine will be put on care and maintenance for an undetermined period.
As reported on August 31, the slower ramp-up of the Beacon mill following a number of mechanical and procurement issues, as well as problems with the grade reconciliation of the material stockpiled, caused cash restrictions and forced the company to slow down its mining activities at Beaufor.
Monarch added that following a review of its operations, the company received confirmation of continuing significant discrepancies between the reported grade of the material mined at Beaufor and the grade of material processed at the Beacon mill, which is causing continued lower cash flow from operations than expected and generating insufficient funds for the company to continue its operations.
The company noted it intends to continue to process the estimated stockpile of 20,000 tonnes to generate funds prior to placing the Beacon mill on care and maintenance.
In addition, Monarch said it is planning to start a complete review of identified issues, including stockpile management and its mining methods in finding solutions to resolve the dilution issues.
Importantly, the company pointed out it has started a strategic review of its assets and operations, adding that it is currently working closely with its lenders, suppliers, customers and potential investors to develop a strategy to fund its activities.
Monarch Mining is a fully integrated mining company that owns four projects, including the Beaufor mine, which has produced more than 1 million ounces of gold over the last 30 years. Other assets include the Croinor Gold, McKenzie Break and Swanson properties, all located near Monarch’s wholly owned 750 tpd Beacon mill.
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