PERTH (miningweekly.com) – ASX-listed Mount Gibson Iron has agreed to a A$64.3-million cash settlement with its insurers for business interruptions suffered as a result of the failure of the Koolan Island Main Pit seawall, in Western Australia, in October 2014.
The mine was placed on care and maintenance at the end of 2014, with Mount Gibson currently reviewing the operation to determine options to rebuild the Main Pit seawall and resume large-scale production.
The miner on Friday said that proceeds from the settlement, which was reached with 14 insurers, would be received by the end of July and would further strengthen the company’s cash position as it continued to evaluate resource investment opportunities and progress activities to restart production from the Main Pit.
“This significant business interruption insurance settlement is a welcome outcome for Mount Gibson and all shareholders in the wake of the failure of the Main Pit seawall at Koolan Island,” said CEO Jim Beyer.
“This settlement, which takes combined insurance proceeds for property damage and business interruption at Koolan Island to just over A$150-million, is well timed to coincide with construction of the starter embankment for the new Main Pit seawall and related activities progressing in line with the project restart schedule.”