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Be the first with the news that moves the market- Trevali Mining (TSX:TV) is suspending operations at the Caribou Mine in New Brunswick
- The company suspended operations due to the low zinc spot price, which made the site unviable for the foreseeable future
- Since the beginning of the year, the COVID-19 pandemic has driven the already poor zinc price to new lows
- Following the suspension, the company has withdrawn its 2020 guidance and intends to release an updated guidance soon
- Trevali Mining (TV) remained steady, with shares trading for C$0.09
Trevali Mining (TSX:TV) is suspending operations at the Caribou Mine in New Brunswick, due to a poor global zinc market.
The company is placing the mine on care and maintenance, with no indication of if or when it expects to restart operations. However, Trevali’s nearby base will continue to serve the company’s other operating mines.
The Caribou team spent the last year reducing costs and improving efficiencies at the mine, trying to maximise profits and maintain mine viability.
However, a further drop in the zinc price over the last few months has rendered production at the site unviable.
The zinc spot price has been trending down since early last year. Now, with the advent of COVID-19 and its effects on global industry, the price has been dropping even more rapidly.
Trevali’s President and CEO, Ricus Grimbeek, stated that the decision to suspend the mine did not come lightly.
“This decision is no reflection on the quality of our team or the operating conditions in New Brunswick.
“While the operation is paused, we will study a multitude of options in the Bathurst region, to maximise value and reduce the overall cost structure of Caribou,” he said.
Due to the suspension and the current volatile market, Trevali is withdrawing its capital guidance. The company intends to release an adjusted guidance in due course, but did not give any firm date.
Furthermore, in an attempt to retain liquidity, Trevali is cancelling its normal course issuer bid and not repurchasing any of its outstanding shares. The bid commenced in December, but the company has not repurchased any shares during that time.
Trevali Mining (TV) remained steady, with shares trading for C$0.09 at 2:11pm EST.
