Mawson West (TSX: MWE, Stock Forum) angered investors today when the company, after successfully completing a US$33.4 million financing package with Galena Private Equity Resources Fund, announced the results of its review of operations at its Dikulushi and Kapulo operations in the Democratic Republic of Congo (“DRC”).
According to the news release, the decision was made to place the Dikulshi mine on care and maintenance due to declining commodity pricing and lower-than-expected copper and silver production at Dikulushi.
The company has commenced a study to determine the best mining strategy, economics and structure to assess future operation opportunities.
During 2014, Dikulushi more than failed to meet expectations, producing 3,000 tonnes of copper in concentrate due to mining dilutions which resulted in lower than expected mined ore grades.
The board has also decided to reduce the work force at the Kapulo project and is also considering its corporate structure and associated costs.
The decision to wind down operations at Dikulushi was made under consultation with Galena and Trafigura Pte, lenders to the company, and the placement of Dikulushi is not expected to affect the previously announced financing and debt restructuring package.
An extraordinary general meeting of shareholders is to be held in Perth, Western Australia on February 25, 2015.
Mawson West was in the news recently when the Perth, Australia-based company announced filing a technical report for the Kapulo project at the end of December.
Shares plummeted 42.86% on the news to $0.02 per share.
Currently there are 214.3m outstanding shares with a market cap of $4.3 million.