Due to the flooding of the Delia NW mine on June 9, 2017
Mandalay Resources Corporation has announced that Compañia Minera Cerro Bayo, a subsidiary of the Company, has commenced giving notice of force majeure to the primary customers, suppliers and contractors of its Cerro Bayo mine. This notice suspends Cerro Bayo’s obligations under contracts with these parties due to the flooding of the Delia NW mine on June 9, 2017.
Mandalay is also initiating consultations with its unions about the potential impacts on employees during this period of suspended production. Mandalay has initiated an independent technical investigation i nto the flooding of the Delia NW mine, as well as risk assessments for restarting operations of the Coyita, Delia SE, Marcela and Raul mines, which form the basis for Cerro Bayo’s current life of mine plan.
The Company is reviewing several alternatives for the future of mining at Cerro Bayo and is consulting with all stakeholders in this review process, including employees, unions, and government officials. The Company expects to be in a position to provide a more detailed update on its plans for Cerro Bayo and the impact of the suspension of operations on the Company’s 2017 production guidance in conjunction with its disclosure of second quarter 2017 financial results, whic is currently expected to occur after market close on August 10, 20 17.