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Tuesday, 2 April 2013
Orosur Mining to focus on cash at San Gregorio
Orosur Mining (LON:OMI TSE:OMI) has re-jigged the strategy for its San Gregorio mine in Uruguay and will now focus on generating cash rather than maximising production.
The miner, which last month announced chief executive David Fowler was stepping down, said that even though production at the mine remains on schedule, operational issues had continued to emerge that were incurring extra expense.
Cash costs have been higher than expected in recent years because of these issues, Orosur said, and over the next six months management at the mine will be given additional time to address these and planfuture mining.
Orosur has also created an exploration arm separate from the team at San Gregorio that will exclusively focus on expanding the company’s gold resources in Uruguay. The exploration team will have a budget of US$1mln to US$2mln over the next 15 months.
Ignacio Salazar, meanwhile, is to take over as interim managing director until Orosur finds a permanent replacement for David Fowler, who will receive US$320,000 in severance, holiday and relocation payments .
Tony Shearer, chairman, said: “The board believes that the change in emphasis from short-term production targets to medium-term cash generation is in the interests of shareholders.
"It will reduce costs and give a higher degree of certainty that the company will meet cash flow forecasts for the three years ending 31 May 2016.
"The board is confident that the company remains on track to deliver the strategy that was outlined in October 2012.”
Orosur added it expects to update on the progress at both Anillo and Pantanillo in Chile in the next two weeks.