London Mining Builds Treatment Center to Fight against Ebola Virus
London Mining (LSE:LOND) is turning a negative into a positive.
The London listed company, which is on the brink of collapse due to declining iron ore prices and the outbreak of the Ebola virus, is transitioning its struggling Marampa iron ore mine into a treatment center to fight the spread of the disease in Sierra Leone.
“We believe it is our duty to provide what help we can to stem the spread of this disease,” said Dan Desjardins, managing director for London Mining.
The heavily-indebted company is constructing a 130-bed center near its Marampa mine, which currently employs 1,400 people, and donating over $165,000 to fight Ebola.
“I salute all our employees for their dedication and contribution in creating what is now an important part of Sierra Leone’s economy and ongoing development,” said Graeme Hossie, London Mining’s chief executive
“I also applaud them for the ongoing leadership role our team has played within the private sector in Sierra Leone in helping address the challenges of the current Ebola crisis. The Marampa mine retains excellent fundamentals and it is our sincere wish for it to find the appropriate financial support to continue operating over the longer term.”
London Mining, whose only operating mine is in Sierra Leone, reported a first-half loss due to a drop in iron ore prices and said the outbreak of the virus across West Africa could hurt production in the second half.
The outbreak, which has been rampant in Sierra Leone, has the ability to cost companies an additional $1 per ton of iron ore produced in 2014 and force a reduction in drilling,” according to London Mining.
The disease, along with the continual decline in iron ore prices, has essentially put London Mining on life support.
The company’s financial woes have toppled over as administrators at Price Waterhouse Coopers (PwC) have taken over the company after failing to find a buyer to bridge the funding gap for its Marampa mine in Sierra Leone. The group has already held “advanced discussions” with several potential buyers, and hopes it will lead to a sale that can be concluded quickly.
“The collapse in iron ore prices and the resulting impacts on this business have been very dramatic. Our focus is to ensure that a buyer is found for the Marampa mine operations given it is such an important part of the Sierra Leone economy,” said Russell Downs, joint administrator and partner at PwC.
“We are liaising with key stakeholders and asking for a short window of forbearance as we look to conclude a transaction.”
The potential downfall of the London Mining has raised fears about international efforts to combat Ebola, which has already claimed 4,500 lives in Sierra Leone, Guinea and Liberia.
Vale invests $150mn to extend life of Manitoba operations
Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.
Global energy transition is boosting the market for nickel
The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.
“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.
“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”
Vale continues drilling program at Manitoba
Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.
“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.
“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”
The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history. Mining of the Thompson orebody began in 1961.
“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.