Wiluna administrators looking at sale
PERTH (miningweekly.com) – The administrators of ASX-listed Wiluna Mining are looking to increase gold recovery from the Wiluna mine in the near term, while exploring recapitalisation or sale opportunities.
Following the first meeting of creditors on August 1, the administrators said that its intentions to continue operating the mine would be dependent on cash flows.
The administrators are also working with technical advisers to review the current mine plan and overall historical performance of the mine’s operations, saying on Monday that investigations into the reasons for the historical performance issues were continuing, as rectifying those issues would be key to maximising a positive outcome being achieved in the administration.
A dual track process is being followed seeking to implement either an asset divestment or recapitalisation. The objective is to maximise the chance of Wiluna, or as much as possible of its operations, continuing in existence; or, if not possible; an outcome that is better for creditors of Wiluna than immediate liquidation.
Prior to entering administration, Wiluna experienced production shortfalls and cost increases compared to its mine plan, while the underground mining operations were ramping up to full production, resulting in significant creditor build-up and stress on current working capital. As a consequence, production of gold concentrate was materially below forecast for April, resulting in a revision of forecast production for the June 2022 quarter.
The miner investigated other options to address the working capital deficit, both before and after the recent capital raising, and while some of these strategies assisted, ultimately, Wiluna was unable to bridge the funding shortfall.
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