Jaguar Mining Fined US$52.5 Million For Tailings Collapse In Brazil
Jaguar Mining (TSX: JAG) has been hit with a substantial fine following the collapse of its dry stack tailings at its Turmalina mine in Minas Gerais, Brazil.
Operations at the mine remain suspended as a result of the collapse, which the company is referring to as a “slump”, with remediation efforts ongoing. The firm has indicated it intends to restart the mine as soon as possible, however a timeline for that restart has not been provided.
The fine itself, which amounts to R$320 million, or US$52.5 million, was issued by the State Secretariat for the Environment and Sustainable Development. Jaguar has stated that it intends to appeal the fine through a formal administrative process, stating that the amount of the fine is “disproportionate to the scale of the event, as well as the actual impact caused by the incident.”
READ: Jaguar Mining Sees Turmalina Mine Shutdown By Regulators
Jaguar has 20 days from the date of issuance to accept the fine, which can be paid in up to 60 monthly instalments, or to present a defense on the matter.
Local reports have suggested that hundreds of people remain displaced by the tailings collapse, with at least seven homes destroyed by the resulting landslide.
Jaguar Mining in 2023 produced 70,704 gold ounces, resulting in topline revenue of $136.5 million and net income of $15.9 million. As of September 30, the company had cash and cash equivalents of US$41.6 million.
Jaguar Mining last traded at $2.48 on the TSX.
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As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.
I recently saw at least one analysts of supposed status giving a “strong buy” to Jaguar in spite of the further drop in share value and the still unresolved status of Jaguar’s willingness and capacity to do what is required to resume production. I saw the same thing at Mt Polley and see it often in WMTF’s multi faceted documentation which includes value pre and post failure. I refer to it “pump and dump” and in the case of Mt Polley’s was able to track how these artificially inflated supports of price held all the way to a final acquisition in a public pension fund portfolio via “fund” that overall met the pension funds criteria for investment. There are no checks against these practices of artificially supporting price to facilitate a dump. Would be nice if “strong buy” had more consensus in it responsible use.