Panoramic Resources has suspended the Savannah nickel mine in the East Kimberley region of Western Australia due to the coronavirus’ ongoing impact to operations.
The temporary suspension has affected multiple aspects of Savannah’s operations including transportation, availability and cost of personnel and equipment and supplies.
Panoramic Resources noted the health and safety of its employees and contractors, along with the “heightened sensitivity” of coronavirus spreading to the Kimberly region’s communities also contributing to the decision.
“This has been a difficult decision to take but is unquestionably the right one for the current operating environment and Panoramic’s particular circumstances,” Panoramic managing director and chief executive officer Victor Rajasooriar said.
“We believe that it will protect the welfare of our staff and contractors, and the surrounding communities, as well as target the preservation of shareholder value through these difficult times.
“We greatly appreciate the support of all our stakeholders through this period in what is an incredibly challenging environment for them also.”
Panoramic stated Savannah’s temporary suspension will help preserve cash while the company works towards reviewing its funding structure for when the mine’s operations recommence.
Along with suspending operations, Panoramic has withdrawn its production and cost guidance along with a suspension to trading in its shares on the Australian Stock Exchange until its plans for Savannah nickel mine’s future are finalised.
Essential services, safety and environmental monitoring will continue to operate at the site, while the company aims to work with employees and contractors to ensure the suspension is undertaken as smooth as possible.
Panoramic recently handed underground operational management of the Savannah nickel mine to Perenti subsidiary, Barminco.
Under the agreement, Barminco undertakes mine development, production and haulage with approximately 120 employees working at Savannah.
Perenti said its Barminco employees could potentially be redeployed to other projects in the company’s portfolio if there is “no clear sight to recommence operations” at Savannah.
Panoramic currently owes Barminco approximately $7 million, which includes the value of work completed in April.