Allied Nevada suspends operations; shifts focus
Allied Nevada Gold Corp. has suspended mining operations near Winnemucca to maximize cash flow and minimize spending through the remainder of its Chapter 11 bankruptcy process.
Allied laid off 230 employees after the company suspended mining operations at Hycroft Mine near Winnemucca.
The miners were given “two months of continued pay and benefits,” said Tracey Thom, vice president of investor relations for Allied Nevada.
According to a news release, 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 June 30 was approximately 260,000 recoverable ounces of gold, sufficient to maintain metal production for the next 12-18 months, the company said.
“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,” said Randy Buffington, president and CEO of Allied Nevada in a statement.
“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 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 the restart of Hycroft mining operations, if at all.
The company said it is continuing to work with its primary creditors for a proposed plan of reorganization order to emerge from Chapter 11 as soon as possible.
Per the agreement, Caesars will continue to operate Harrah’s for the first half of 2020 before it’s redeveloped into a non-gaming hotel and mixed-use development.