Home » , , » PNG's Sinivit Gold confirms financial crisis

PNG's Sinivit Gold confirms financial crisis

Staff Reporter | 2:18 AM | ||
THE Sinivit Gold mine in East New Britain Province is not operating in a profitable level at the moment so it is very hard to free cash up and operate at the same time.

Developer of the mine, New Guinea Gold Limited, operates as a subsidiary of Canadian Company, New Guinea Gold Corporation.

Company director Greg Heaney confirmed that the company was going through financial difficulties, adding that it was very challenging and that the mine was small and it was difficult profitably.

Mr Heaney, who is based in Brisbane, was in Kokopo recently for the Sinivit Gold mine memorandum of agreement review.

He was responding to questions regarding former workers’ outstanding entitlements and the delay in paying their creditors.

The company has yet to settle former workers’ outstanding entitlements following a mass termination of employees in a redundancy exercise in June this year.

However, Mr Heaney said they have paid 25 per cent of the former workers’ entitlements.

More than 50 of them were made redundant in June which was an outcome of a recent review by the company of its Sinivit operations.

The former employees were told that entitlements as well as superannuation will be paid to them.

Since then, they have been waiting for their entitlements as well as an update of their Nasfund superannuation contributions.

The workers were paid their 25 percent entitlements last week according to Mr Heaney with the rest to be paid in the next few months. He also said their creditors’ balances were coming down slowly. “We are in the process of raising capital to try and rectify that and also to finance the phase two program at the mine which would be profitable,” he said.

He said they were looking at raising capital to assist in paying creditors more quickly and to commence construction of the mine’s phase two developments.

Meanwhile, it is understood that New Guinea Gold Corporation’s stock has been the subject of a Cease Trade Order since July 4, 2013 due to failure by the company to submit audited financial statements for the year ended December 31, 2012. To this day, the Company’s shares remain suspended from trading on the Toronto Stock Exchange (TSX-V).

A recent statement from the company stated that the company was working through a process with its auditors that will enable them to issue an unqualified audit opinion in relation to the year ended December 31, 2012 and that the Company expects the revocation of the CTO to follow shortly thereafter, along with a reinstatement to trading of the Company’s securities on the TSX-V.

Mr Heaney confirmed the suspension and said it will be lifted soon as it was associated with the company’s auditors in Canada. 

The Post Courier