CuDeco’s copper mine remains idle while it tries to raise cash
CuDeco’s woes are continuing with the prolonged suspension of its Rocklands copper mine in Queensland until it can raise more cash and implement “business improvement” initiatives.
The struggling producer (ASX:CDU) is doing its best to reassure investors that it will try and keep the suspension as “short as possible”.
“While this extension of suspended operations impacts our short-term production targets, it is crucial towards facilitating a comprehensive reset of our operation and refinement of our business model,” chairman Peter Hutchison told investors on Thursday morning.
“CuDeco also continues to seek improved financing arrangements, including a long-term structured facility and enhanced access to working capital in the short-term via a financing arrangement which is at an advanced stage of negotiation.
“We will seek to ensure the operational suspension is as short as possible and will provide further updates on the progress of our funding and operational enhancement initiatives.”
The company had $1.3 million cash in the bank and about $91.4 million in debt at the end of June.
CuDeco initially announced that it halted mining and processing at the Rocklands mine at the end of August, but the suspension was only supposed to continue until September 10 so the company could undertake critical maintenance work.
The company has been suspended from trading for six months now. It was initially suspended in March while it worked on an ore reserve update, but it is now trying to finalise the financials for the last six months of 2017.
Cudeco said in July the task of completing its 2017 financials is dependent on the company satisfying its external auditors that it can “continue as a going concern”.
To do that the company is working with major creditors, banks, financiers and major shareholders to put in place a financial plan.
Once that is done CuDeco can complete its financials and resume trading.
The company has been in dire straits since December last year, when it was forced to suspend operations at the mine by the Queensland government after a number of safety issues were identified with the processing plant.
It then faced further disruption from extreme storms, which washed out a section of the access road to the Rocklands site.
CuDeco says while operations are suspended it will undertake further preventative maintenance works and complete the final stages of its business restructuring program.
The company has been contacted for comment.