One of the first casualties appears to be Golden Minerals Company, who Friday announced that it has suspended all operations at its Velardena mine until prices for silver and gold “indicate a sustainable margin for operations“.
From Golden Minerals:
GOLDEN, Colo., June 21, 2013 /PRNewswire/ – Golden Minerals Company
(NYSE MKT: AUMN); (TSX: AUM) (“Golden Minerals” or “the Company”)
announced that it has suspended operations at its Velardena mine as of
June 21, 2013, in order to conserve the asset until operating plans and
prices for silver and gold indicate a sustainable cash margin for
operations. The employees at the Velardena mine were informed of the
Company’s decision in the afternoon of June 21, 2013. In February 2013
the Company anticipated the Velardena operations would achieve operating
cash neutrality during the third quarter 2013, assuming gold and silver
prices of $1,600 per ounce and $30 per ounce, respectively. In May 2013
the Company projected a $5 million negative margin from the operations
for the remaining three quarters of 2013 at prices of $1,500 gold and
$25 silver. Metals prices have continued to decline and remain below
these levels.
(Logo: http://photos.prnewswire.com/prnh/20120803/LA52082LOGO)
The Company is placing the mine and processing plants on a care and maintenance program to enable a re-start when operating plans and metals prices support a cash positive outlook for the property. Approximately 470 positions at the Velardena operations are being eliminated as a result of the suspension. The Company is presently negotiating the specific terms of a severance package with its labor unions. The Company plans to retain a core group of approximately 50 to 60 employees to facilitate a re-start of operations and to maintain and safeguard the longer term value of the asset.
(Logo: http://photos.prnewswire.com/prnh/20120803/LA52082LOGO)
The Company is placing the mine and processing plants on a care and maintenance program to enable a re-start when operating plans and metals prices support a cash positive outlook for the property. Approximately 470 positions at the Velardena operations are being eliminated as a result of the suspension. The Company is presently negotiating the specific terms of a severance package with its labor unions. The Company plans to retain a core group of approximately 50 to 60 employees to facilitate a re-start of operations and to maintain and safeguard the longer term value of the asset.
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