Goldplat Plc has shut down its Migori gold mine due to lack of funds.
The company says it is also ready to sell the Kenyan operation.
The decision means that jobs at the mine are at risk, with the government also facing difficulty in collecting taxes from the troubled miner.
London-based Goldplat Plc has shut down its Migori gold mine after failing to get funding needed to run the operations profitably.
The multinational says it continues to seek strategic investors to provide the Kenyan business — owned through its local subsidiary Kilimapesa Gold (KPG) — with new capital.
The company added that it is also ready to sell the Kenyan operation. The decision means that jobs at the mine are at risk, with the government also facing difficulty in collecting taxes from the troubled miner.
“I believe that putting Kilimapesa on care and maintenance, until the required external funding can be raised, is best for all stakeholders involved,” Goldplat chief executive Werner Klingenberg said in a trading update.
Placing a mine under care and maintenance means that production stops and only a few employees are needed to make sure the site remains in safe and stable condition. The plan is to ensure that future production can resume quickly and more efficiently.
Gold output at the Migori mine stood at 569 ounces in the three months ended March, down from 1,241 ounces a year earlier. Sales of the precious metal also fell to 639 ounces from 1,380 ounces.
“Goldplat will continue to engage with the stakeholders of KPG, including large creditors and employees, whilst seeking the external funding required to develop the operations,” the multinational said.
“The company has received substantial support from a number of the engaged stakeholders, who committed to not demand payment from KPG in the next six months.”
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