Gold miners hit problems

Two Perth-based gold miners have run into trouble, with Troy Resources striking problems at its mine and Kingsrose Mining falling into voluntary administration.

Kingsrose told the market it had appointed Michael Ryan and Ian Francis of FTI Consulting as voluntary administrators of the business, while its Talang Santo gold mine in Indonesia would be placed on care and maintenance.

In a statement, Mr Ryan said the voluntary administration process would provide Kingsrose and its stakeholders with breathing space and protections to make the decisions about the future of the company.

“As part of the restructuring process, Kingsrose’s 85 per cent owned subsidiary PT Natarang Mining will commence the process to apply for suspension of debt payment obligations (PKPU) in Indonesia,” he said.

“FTI Consulting’s Jakarta practice will assist the company with the PKPU process and will work in conjunction with the administrators to attempt to restructure and recapitalise the company as soon as practical.”

Meanwhile, Troy Resources’ shares were battered on the ASX after the company announced problems at its Karouni gold mine in Guyana.

The company told the market today that regular monitoring checks recently indicated an increase in unstable ground conditions around the southern wall of the Smarts pit, which has restricted access to higher grade areas in the pit.

“These measures will impact on the company’s guidance for CY16 which is now expected to be between 63,000 and 65,000 ounces,” Troy said in a statement.

“As a result, unit costs will also be higher due to lower estimated production output and the additional costs required in order to manage the pit conditions.”

Troy shares were 34.6 per cent lower to 16 cents each at the close of trade.