Modern Mining March 2016

MINING News

MawsonWest to stop operations at Kapulo

MawsonWest, listed on the TSX (but based in Perth, Australia), has decided to place its small Kapulo copper mine in northern Katanga in the DRC on care and mainte- nance. The company is planning to cease mining at the end of March, with milling operations continuing into April. Kapulo is a relatively newmine, with commissioning having only started in late 2014. The company says it has made this decision due to continued weakness in the price of copper, which has resulted in unprofitable and unsustainable mining operations at the mine. “At current prices, the company is pro- ducing at levels insufficient to cover its operational and financial obligations, and is also depleting Kapulo’s short mine life (four years) to generate little to no free cash flow,” comments Anthony Lloyd, Acting CEO of Mawson West. “The company has deter- mined that the best course of action is to place the mine on care andmaintenance in order to preserve the asset until such time

as the price of copper recovers sufficiently to permit profitable mining. Our majority shareholder and secured creditors are in agreement with this course of action and have agreed to arrangements which will permit this to occur. ”While the financing is quite dilutive and will, if approved by minority shareholders, likely result in the com-

pulsory acquisition of their interests, the company requires financing in any event and the alternative would more than likely be insolvency proceedings whichwould be of uncertain outcome for minor- ity shareholders.” 

The processing plant at Kapulo in the DRC. Mawson West has decided to place the mine on care and mainte- nance as a result of the low copper price (photo: Mawson West).

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March 2016  MODERN MINING  13