Allied Nevada Gold Corp. (OTCBB:ANVGQ) announces that it has suspended mining operations, effective immediately, to maximize cash flow and minimize spending through the remainder of its chapter 11 process. The Company will continue to process and produce gold and silver through the operation of the heap leach pads and Merrill-Crowe processing plants. Inventory on the heap leach pads at June 30, 2015 was approximately 260,000 recoverable ounces of gold, sufficient to maintain metal production for the next 12-18 months.
“This was a very difficult decision to make with the understanding that it will impact our employees and the businesses and communities that depend on the Hycroft Mine,” commented Randy Buffington, President & CEO of Allied Nevada. “However, the current metal price environment, cost pressures and workforce challenges we have encountered over the last few months have adversely impacted our ability to meet our operating goals. This change, while unfortunate, is critical to getting the Company through the bankruptcy process.”
In addition to continuing metal process operations, Allied Nevada intends to complete construction of and operate a 10 ton per day mill demonstration plant for processing of sulfide ores. The demonstration plant is expected to start-up in September 2015 and will include all phases of the mill process flow sheet, from grinding and flotation through AAO and precious metals recovery. The primary goal of the demonstration plant is to further substantiate the conclusions of the feasibility study regarding the processing of sulfide ores and constructing a mill, including that the assumptions for proposed capital, and whether operating and recovery projections are attainable in a commercial setting.
At this time Allied Nevada does not have an expected time-frame for, or an expectation with respect to, the restart of mining operations, if at all. The Company is continuing to work with its primary creditor constituencies to formulate modifications to its previously filed proposed plan of reorganization in order to emerge from chapter 11 as soon as possible.
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