Business / Companies
New Dawn to dispose its Zimbabwe gold assets
16 Aug 2013 at 01:17hrs | Views
TORONTO Stock Exchange listed miner, New Dawn, says it is negotiating with several parties to dispose two of its gold mines in the country, Venice and Old Nic.
New Dawn announced last month that it may be forced to dispose of its operations in Zimbabwe if measures aimed at reducing operating costs in the wake of weak gold prices prevailing on the international markets do not yield desired results.
The company owns 100 percent of the Turk and Angelus, Old Nic and Camperdown Mines.
In addition, through its Falcon Gold Zimbabwe Limited subsidiary, New Dawn currently owns 84, 7 percent of Dalny, Golden Quarry and Venice mines, and a portfolio of prospective exploration acreage in Zimbabwe.
In a statement, New Dawn said following a status review of its portfolio it was deemed that a number of projects only provided nominal value to the company.
"As a result of this review, the company has initiated a programme to sell some of its mining assets that are not considered integral to its long-term strategy, and is also continuing to attempt to raise additional capital through financing via debt and/or equity issuances," it said.
"As part of this divestiture process, the company is engaging with several potential parties in an attempt to sell Old Nic Mine and Venice Mine."
The company, which adopted various strategies to lower operating costs early this year, said it would continue implementing the strategies while focusing on improving operating efficiencies and processes.
The company said it would continue implementing the cost-cutting measures until market conditions improved and when the company was able to access debt and or equity capital in sufficient amounts to fund the expansion and development of its mining operations and exploration programmes.
"With the company under serious pressure to bring operating costs in line with the current gold price regime, combined with its challenging working capital position and the increasingly difficult regulatory and economic environment in Zimbabwe, and the heightened uncertainty surrounding the implementation of indigenisation policy subsequent to the 31 July 2013 national elections, there is a significant risk that actions more severe than steps taken so far or currently envisaged may be required.
"If the world price of gold continues to decline further and or the company's operational liquidity is further strained, it may be forced to consider shutting down some or all of its mining operations in Zimbabwe, either temporarily or permanently, and or the liquidation of the company and its assets in formal or informal arrangement."
Some of the cost-cutting measures introduced include cessation of all capital development projects except those that need to be commissioned to sustain operations for the next six months. - New Ziana
New Dawn announced last month that it may be forced to dispose of its operations in Zimbabwe if measures aimed at reducing operating costs in the wake of weak gold prices prevailing on the international markets do not yield desired results.
The company owns 100 percent of the Turk and Angelus, Old Nic and Camperdown Mines.
In addition, through its Falcon Gold Zimbabwe Limited subsidiary, New Dawn currently owns 84, 7 percent of Dalny, Golden Quarry and Venice mines, and a portfolio of prospective exploration acreage in Zimbabwe.
In a statement, New Dawn said following a status review of its portfolio it was deemed that a number of projects only provided nominal value to the company.
"As a result of this review, the company has initiated a programme to sell some of its mining assets that are not considered integral to its long-term strategy, and is also continuing to attempt to raise additional capital through financing via debt and/or equity issuances," it said.
The company, which adopted various strategies to lower operating costs early this year, said it would continue implementing the strategies while focusing on improving operating efficiencies and processes.
The company said it would continue implementing the cost-cutting measures until market conditions improved and when the company was able to access debt and or equity capital in sufficient amounts to fund the expansion and development of its mining operations and exploration programmes.
"With the company under serious pressure to bring operating costs in line with the current gold price regime, combined with its challenging working capital position and the increasingly difficult regulatory and economic environment in Zimbabwe, and the heightened uncertainty surrounding the implementation of indigenisation policy subsequent to the 31 July 2013 national elections, there is a significant risk that actions more severe than steps taken so far or currently envisaged may be required.
"If the world price of gold continues to decline further and or the company's operational liquidity is further strained, it may be forced to consider shutting down some or all of its mining operations in Zimbabwe, either temporarily or permanently, and or the liquidation of the company and its assets in formal or informal arrangement."
Some of the cost-cutting measures introduced include cessation of all capital development projects except those that need to be commissioned to sustain operations for the next six months. - New Ziana
Source - chronicle
