JOHANNESBURG (miningweekly.com) – Aim-listed West Africa-focused gold mining company Amara Mining on Wednesday announced that mining had been halted at its Kalsaka/Sega gold mine in Burkina Faso, and that the operation would be put into liquidation.
The company said this decision followed the receipt of a default notice by its local subsidiary in Burkina Faso, Seguénéga Mining SA (SMSA), from Kalsaka/Sega mining contractor BCM International.
However, Amara was due to start the process of closing its local subsidiaries in Burkina Faso during the fourth quarter this year; therefore, while the default notice accelerated this event, it did not represent a material change to the company's strategy for Kalsaka/Sega,” Amara chairperson and CEO John McGloin said.
"The structure of the company will be simplified and we will become an explorer/developer, with the true value within Amara remaining intact,” he explained.
Amara said SMSA had taken the decision to start liquidation in Burkina Faso to protect employees and all creditors, including Amara and its subsidiary Kalsaka Mining SA (KMSA), who were collectively SMSA's largest creditors.
“Processing activities carried out by KMSA are continuing in the short term pending the appointment of a liquidator for SMSA,” Amara said.
A $3-million bond was in place in Burkina Faso, which more than adequately provided for the rehabilitation of the Kalsaka/Sega site and facilitated the efficient closure of the operation, with $1-million of environmental rehabilitation work already having been completed.
Further, as a consequence of the company’s transition from producer to developer, CEO Peter Spivey had resigned effective immediately.
McGloin had been appointed CEO, while also retaining the position of chairperson.