The company said problems related to grade reconciliation of the material stockpiled caused cash restrictions and led to the slowdown of its mining activities at the Beaufor mine
Monarch halts operations at Beaufor mine. (Credit: Monarch Mining Corporation)
Canadian mining company Monarch Mining has suspended operations at its 100% owned Beaufor mine, due to financial and operational challenges.
Beaufor is an underground mine, located around 20km northeast of the town of Val-d’Or, in Abitibi-East Township, in the province of Quebec.
It covers 5.9km² of area, holds three mining leases, one mining concession and 23 mining claims, and has produced more than one million ounces of gold in the last 30 years.
Monarch Mining said that the mine will be put on care and maintenance for an undetermined period.
Monarch Mining president and chief executive officer Jean-Marc Lacoste said: “The decision taken today by the Board and management was after careful consideration of all available information from the mine and mill operations, and the corporation’s current and projected financial situation.
“We understand that this situation is difficult for our shareholders, employees and stakeholders.
“We will continue to work towards resolving the present situation at the operations while seeking strategic and financial alternatives to maximise stakeholder value.”
According to the company, the mechanical and procurement issues resulted in the slowdown of the restart and ramp-up of the Beacon mill.
In addition, the problems related to grade reconciliation of the material stockpiled caused cash restrictions and led to the slowdown of its mining activities at the Beaufor mine.
The review of operations revealed significant discrepancies between the reported grade of the material mined at Beaufor and the grade of material processed at the Beacon Mill.
It contributed to decreased cash flow from operations than expectations, and created a deficit in funds to continue the operations, said Monarch.
The company will continue to process the estimated stockpile of 20,000 tonnes prior to placing the Beacon Mill on care and maintenance.
Also, it will start a complete review of identified issues, including stockpile management and its mining methods in finding solutions to resolve the dilution issues.
The company is currently working closely with its lenders, suppliers, customers and potential investors to create a strategy to support its activities.