- Argonaut Gold Inc. (TSX:AR) is suspending mining operations until April 30, due to the Mexican Government instigating a nation-wide shutdown to stem the spread of COVID-19
- Argonaut will halt mining operations at the El Castillo, San Agustin and Colorada mines in Mexico, and is withdrawing its 2020 guidance
- The suspension has not yet impacted the company’s planned merger with Alio Gold Inc but both companies can withdraw from the merger if the suspension extends past 45 days
- The company will continue to process and sell metal through its heap leaching facilities
- Argonaut Gold Inc (AR) is down 4.63 per cent, with shares trading at C$1.03 and a market cap of $185.93 million
Argonaut Gold Inc (TSX:AR) is suspending mining operations this month, due to the Mexican Government’s new mandated shutdown.
The mandate calls for all non-essential businesses and operations to cease until April 30, in an effort to reduce the spread of COVID-19.
Argonaut currently operates the El Castillo, San Agustin and Colorada mines in Mexico. The company has stated it will begin stepping down operations at all of its mining operations.
The shutdown has not, thus far, impacted Argonaut’s planned merger with Alio Gold Inc. However, a stipulation states that Alio or Argonaut can withdraw from the merger if the suspension extends past 45 days.
Due to the impact this shutdown is likely to have on production forecasts, Argonaut is withdrawing its 2020 guidance. The company has not announced when a new guidance will be provided.
However, Argonaut expects metal production and sales to continue through the mine’s leach heaping sites.
Pete Dougherty, President & CEO of Argonaut Gold, believes the company must do all it can to stem the spread of novel coronavirus
“It is important to recognize the seriousness of the COVID-19 pandemic and while we have not experienced a known or suspected case in the company to date, we have been and will continue to take precautionary measures.
“We must continue to process pregnant solution coming from the heap leach pads for the safety of the environment. Therefore, we expect to continue metal production and sales,” he said.
Alongside the shutdown, the Mexican Government declared a state of emergency earlier today, after confirmed cases of COVID-19 in the country surpassed 1,000.
The company has three development projects also within Mexico. The company did not state whether exploration and development work will be suspended during the work-ban. Although this seems likely, given the wide-spread nature of the government mandate.
Argonaut Gold Inc (AR) is down 4.63 per cent, with shares trading for C$1.03 at 12:15am EST.