Gryphon cuts staff, suspends drilling to lower costs
PERTH (miningweekly.com) – Africa-focused gold developer Gryphon Minerals has announced a range of measures to reduce its operating cost, including a 75% reduction in personnel and a reshuffle of its board.
The miner said on Monday that David Netherway, Andrea Hall and Michael O’Neill have resigned as directors, while CFO Beth Michetti, general council Alex Eastwood and chief exploration manager Micheal Fox would also step down, effective from July 31.
The remaining nonexecutive directors and managing directors have agreed to a 20% pay cut, while the base salaries of several other key executives would also be either reduced or supplemented in shares.
Staff and contract numbers at the Perth head-office have also been reduced by some 45%.
Further, Gryphon suspended all drilling, while field work has been limited to low-cost target generation. The company said that it would also place the long-lead single-stage milling circuit on standby, deferring an A$8-million cost.
“These initiatives are all part of our ‘de-risk, get ready and add value’ strategy to preserve value for shareholders and, importantly, none of these changes will have an impact on Gryphon’s ability to move ahead quickly with the development of the Banfora gold project at the appropriate time,” said MD Steve Parsons.
A bankable feasibility study on the Banfora gold project, in Burkina Faso, has indicated that gold production could start as early as the fourth quarter of 2014, with the mine producing some 151 000 oz/y over the first five years.
Capital costs for the project have been estimated at $208-million, with the project having a net present value of $121-million, at a gold price of $1 300/oz, and an internal rate of return of 17%.
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