15/04/2020 - 13:00

Panoramic Resources closes struggling mine

15/04/2020 - 13:00

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Panoramic Resources has announced the temporary closure of its Savannah nickel mine in the East Kimberley.

Panoramic Resources closes its Savannah nickel mine due to coronavirus and operational issues.

Panoramic Resources has announced the temporary closure of its Savannah nickel mine in the East Kimberley. The move makes Savannah the second mine in Western Australia to have closed due to the COVID-19 crisis, after Northern Minerals shut its Browns Range operation in the Kimberley a few weeks ago. 

None of Panoramic’s workforce have tested positive to the virus, yet its leadership say they have acted due to a cocktail of operational uncertainties, including increased transportation costs and availability of supplies, equipment and personnel. 

Despite the biological threat of the virus starting to wane considerably across WA, the company was adamant that the COVID-19 uncertainty could last for ‘several months’.

The Kimberley has been more heavily fortified than other regions under the State Government’s travel restrictions due to its high aboriginal population and the heightened vulnerability should the virus be unleashed in remote communities. As such, only government, defence and 'essential services' workers are allowed to travel to and from the region. 

Additional, unforeseen expenditure associated with logistical measures may have brought Savannah's operational financial feasability to the brink.

Ceasing production and processing at the Savannah mine, Panoramic has now chosen to focus its energies on solving the funding problems of its new sister project - Savannah North. It claims to be liaising with a number of parties to settle debts and secure new investment aimed at ensuring, when normal operations resume, that 'efficiency and profitability is optimised and a robust and appropriate funding structure is in place'.    

Noting that staff welfare was of paramount importance to the company’s navigation through this period, CEO Victor Rajasooriar commented that it had been a “difficult decision to take but is unquestionably the right one for the current operating environment and Panoramic’s particular circumstances”. All staff and contractors can rely on receiving their ‘contractual entitlements’.

Over the last few years Panoramic has been engaged in a variety of capital raising pursuits, coinciding with a decline in mine output. Its share price has fallen 81 per cent since June 2018.

Panoramic has requested that all trading of its shares on the ASX be ceased until ‘a new funding pathway is finalised’. All production and cost guidance has also been withdrawn.  

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Elsewhere, COVID-19 restrictions in the Philippines have begun to lift resulting in Medusa Mining being able to reopen its Gold mine in Bunawan province.

Maintaining virus-mitigating measures, local authorities have granted the company permission to operate under the condition that workers are sourced only from within Bunawan province.

The mine in question, the Co-O gold mine, produces the lion’s share of Medusa’s output. In February, Medusa's half-yearly findings reported an NPAT of 194 per cent.

 

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