UK listed Goldplat Plc’s local subsidiary Kilimapesa Gold (KPG) is open to selling its Migori mine after failing to secure adequate capital injection to facilitate the efficient running of the mineshaft.
KPG sought funds to facilitate the establishment of a new plant in Migori and the acquisition of equipment to boost the firm’s production to a level that would allow it to make profit. The lack of funding has seen the firm shut down all operations at the site in a move that could leave numerous employees of the company jobless.
“I believe that putting Kilimapesa on care and maintenance, until the required external funding can be raised, is best for all stakeholders involved,” Goldplat Chief Executive Werner Klingenberg said in a trading update.
According to a news report by the Business Daily, placing a mine under care and maintenance means that production stops and only a few employees are needed to make sure the site remains in a safe and stable condition.
The Business Daily similarly reports that the company’s financial woes has seen it fail to pay taxes to the government. Goldplat is however liaising with local strategic investors to fund the struggling business with capital.
“Goldplat will continue to engage with the stakeholders of KPG, including large creditors and employees, whilst seeking the external funding required to develop the operations. The company has received substantial support from a number of the engaged stakeholders, who committed to not demanding payment from KPG in the next six months,” the multinational company said in an official statement.
The gold mining firm’s inability to land investors has hurt production at the company in recent months. Gold harvest at the Migori mine stood at 569 ounces in the first three months of 2019 down from 1,241 ounces recorded during a similar period last year. Sales of the precious metal also fell to 639 ounces from 1,380 ounces in the same period.