Firefinch Limited (Mali Lithium)
Firefinch Limited (Mali Lithium)
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Australian-based miner Firefinch has given up on its efforts to recapitalise its 80%-owned Morila gold mine in Mali, almost certainly sending the mine once known as “Morila the Gorilla” into insolvency.
Australian-based miner Firefinch has given up on efforts to recapitalise its 80%-owned Morila gold mine in Mali, almost certainly sending the mine once known as “Morila the Gorilla” into insolvency.
Firefinch acquired the mothballed project from past owners Barrick Gold and AngloGold Ashanti for $US28.87M just two years ago and began retreating tailings while planning to restart its giant openpit mine.
Directors of Australian-based miner Firefinch have dropped their plan announced last week to raise $A90M through a two-tranche placement to continue the ramp-up of its battling Morila gold mine in Mali.
The company cites downward movement in $US dollar prices and $A/$US exchange rates for dropping the major component of its recapitalisation package.
Firefinch says it will consider alternative funding options for its medium-term production plan with its lead managers.
The new leaders of beleaguered miner Firefinch say they have a clear path to improved performance at its 80%-owned Morila gold mine in Mali if shareholders approve a $A90M recapitalisation package that follows a revised production target.
The two-stage equity raise will be followed by a share purchase plan for up to $10M.
Firefinch has also negotiated debt-to-equity conversions of $US23.4M with mining services contractor MEIM Morila and $4.89M with other trade creditors.
“Morila the Gorilla” is growing again, with 80% owner Firefinch posting an increase in its measured-indicated-inferred gold resources at the famous Mali mine by over a million ounces to 3.33Moz (66.65Mt @ 1.55g/t).
The resource update, based on Firefinch’s intensive drilling this year, comprises 2.7Moz (58.8Mt @ 1.43g/t) for openpit and 636,000oz (7.88Mt @ 2.51g/t) underground. Including its satellite deposits, the global mineral resource is now 3.58Moz (73.5Mt @ 1.52g/t).
The ‘perfect storm’ of events that have dragged the performance of its Morila Super Pit have left new miner Firefinch relying on increased resource and reserve estimates and a new mine plan to restore its fortunes.
Embattled miner Firefinch hopes increases in resource and reserve estimates feeding into a new mine plan will help turn around performance at its Morila Super Pit in Mali after slow June qtr (Q2) output resulted in it ditching the mine’s FY2022 production guidance.
Firefinch’s 80%-owned giant openpit mine has delivered about 13,300oz gold for the three months, up from 10,874oz in Q1 but well behind its forecast 17,000-20,000oz.
The demerger and ASX listing of Mali-focused miner Firefinch’s Goulamina lithium project is on track after the initial public offering to raise up to $A100M for Leo Lithium closed oversubscribed with strong support from Firefinch shareholders and high-quality institutional investors.
Over 90% of the offer was allocated to existing Firefinch shareholders. Firefinch has acquired its full $20M allocation.
The new company is expected to begin trading on June 23.
Gold miner and current lithium developer Firefinch is proposing to separate its assets by spinning off its lithium developer Leo Lithium under a demerger proposal.
Firefinch currently owns 80% of the producing Morila Gold Mine in Mali and 100% of the Goulamina Lithium Project, also in Mali. Under the proposed deal, Leo Lithium would own Goulamina and Firefinch would own a 20% stake in Leo Lithium.
The commencement of mining six weeks ahead of schedule from the N’Tiola satellite deposit at its 80%-owned Morila gold project in Mali has enabled Firefinch to meet production guidance with 10,874oz gold in the March qtr (Q1FY22).
While down from the previous period’s 11,115oz, Firefinch predicts production will grow to 17,000-20,000oz in Q2 and increase more in H2 once ore mining resumes at the Morila Super Pit. Mining of the Beledjo satellite pit is also scheduled to begin in Dec 2022.