Sierra Rutile has announced that production at its recently restarted Area 1 operations in Sierra Leone has been partially impacted due to unlawful – yet so far peaceful – strike action from yesterday.
Sierra Rutile has announced that production at its recently restarted Area 1 operations in Sierra Leone has been partially impacted due to unlawful – yet so far peaceful – strike action from yesterday.
Theuns de Bruyn-led Sierra told the market processing work at one of the site’s three wet concentrator plants, along with its mineral separation plant, had been interrupted.
Sierra said the company’s grievance policy had not been utilised by the employees in question and it intends to have the matter resolved.
“Management is engaging with employees and union officials to understand the rationale for the strike action, as well as with the labour ministry and senior officials of the government of Sierra Leone to seek assistance in resolving the issue,” the company said.
Sierra said its mining operations and concentrators had restarted operations on May 10, along with its mineral separation plant nine days later.
Along with this, the Perth-based junior has taken steps to alleviate previous power issues at the site, signing a new seven megawatt power supply contract with Himoinsa Southern Africa.
On January 29, the company announced it would suspend operations at Area 1 from May 11, following the SLG’s decision to re-negotiate terms of their third amendment agreement.
The SLG desires for both parties to revert back to a fiscal regime established on November 20 2001 – which would require Sierra to make a substantial payment to the SLG in regard to its 2023 financial year.
Sierra says this would majorly impact the company from a financial and operational perspective.
Despite the suspension, and likelihood of redundancies, Sierra remained hopeful of reaching a positive outcome and restarting operations.
After Sierra received a notice from the SLG alleging it had breached the Mines and Minerals Development Act 2023 the company told the market on May 8 it would restart mining at Area 1 despite not agreeing that it had committed the alleged breach.
Aside from negotiations with GSL, Sierra has also been dealing with a potential takeover from US-based Gerald Group, owner of bidder PRM Services.
On April 25, PRM issued a requisition under section 249D of the Corporations Act 2001, calling for the removal of Mr de Bruyn as a director of Sierra.
The company will now hold an EGM on June 25, where shareholders will vote on the matter.
Sierra closed trade at 13.5 cents per share.
