Gascoyne Resources’ administrators have decided to maintain operations at the Dalgaranga gold mine in Western Australia during its administration process.
The administrators aim to maximise the chances of Gascoyne continuing its existence, which is considered a better outcome than immediate liquidation for creditors.
Gascoyne administrators, who are senior managing directors of FTI Consulting, are optimistic about the gold operations, with the support of employees, banking lenders, NRW Holdings and suppliers.
They expect to continue Gascoyne’s operations on a break even or better basis, considering the voluntary administration suspension, their ability to sell gold at the current high gold price and as mining progresses to access the more continuous area within the main Gilbeys orebody.
The administrators have obtained the assistance of expert technical advisors to increase ore mining and reduce waste mining, while preserving and optimising the long-term mine value.
Technical advisors Mining One and the Gascoyne group management are also working to develop an updated optimised life of mine plan for the Gilbeys orebody.
“At this stage the administrators expect that the administration may last from two to six months, subject to the outcome of the technical review and ongoing trading performance,” FTI Consulting said in a statement.
The administrators are exploring options for short-term funding to support ongoing trading.