Mining
Monday, August 8th, 2022 8:43 am EDT
However, the mine restart took longer than planned due to difficulties in hiring operating personnel, supply chain challenges and unanticipated electrical and mechanical work. This, together with lower copper prices, caused a shortfall in revenues compared to budget. In addition, Imperial Metals’ previously announced rights offering was not fully subscribed, resulting in a shortfall in budgeted equity financing. Due to these reasons, the company is now seeking additional funding via debt financing.
The convertible debentures will have a five-year term ending August 31, 2027. Each C$3.20 of the principal amount will be convertible into one common share of Imperial Metals. Up to 14.06 million common shares are expected to be issued if all the convertible debentures issuable were converted.
Murray Edwards, the company’s largest shareholder, has advised that he intends to purchase between C$30 million and C$35 million of the debentures.
Located about 56 km northeast of Williams Lake in south-central British Columbia, the Mount Polley copper-gold underground mine was first shut down in 2014 after a massive tailings pond collapse. Imperial Metals had to rebuild the mine’s tailings and spent more than C$70 million in environmental rehabilitation. Operations resumed two years later, but was halted again in 2019 due to a slump in copper prices.
Aiming to restart the operation once again, Imperial Metals has spent around C$22.4 million in one year, dating back to the end of the March 2021 quarter. This includes C$21.7 million in operating costs and C$700,000 in depreciation expense. Exploration, development and capital expenditures on Mount Polley rose by C$2 million in the March 2022 quarter in comparison to the 2021 quarter.
In the week following the repair of a key electrical component on July 27, the concentrator at Mount Polley produced concentrate containing approximately 336,000 lb. of copper and 550 oz. of gold against the budget for the initial week following start-up of 188,403 lb. of copper and 495 oz. of gold.
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