SSR Mining Reports First Earnings Since Çöpler Mine Collapse
SSR Mining Inc. (TSX: SSRM) has released its consolidated financial results for the first quarter ended March 31, 2024, its first report since Çöpler mine incident that occurred on February 13, 2024.
The Çöpler mine incident, which led to the suspension of operations, has been the focal point of SSR Mining’s recent efforts. A significant slip on the heap leach pad prompted the suspension of operations at the mine. Nine individuals were unaccounted for at the time of the incident. The company, grappling with the aftermath at the time, expressed its inability to estimate when operations will resume at Çöpler.
The company said it continues to prioritize the recovery of missing colleagues, with four individuals recovered thus far. Efforts to recover the remaining five individuals are ongoing, with over 6.7 million tonnes of heap leach material relocated, including 4.2 million tonnes from the Sabırlı Valley.
SSR Mining anticipates completing the removal of all displaced heap leach material from the Sabırlı Valley into temporary storage locations by the third quarter of 2024. Concurrently, containment efforts have been implemented, including the installation of a grout curtain, coffer dam, buttress, pumping systems, and diversion channels.
A comprehensive remediation plan is underway following consultations with Turkish government agencies, ministries, experts, and consultants. The plan, expected to be submitted for government approval in the second quarter of 2024, involves constructing a permanent storage facility for the displaced material, estimated to cost between $250 to $300 million. As of March 31, 2024, approximately $22.5 million has been incurred towards remediation efforts.
CEO Rod Antal clarifies in the earnings call that the $250 to $300 million estimate does not include care and maintenance costs throughout the 2 to 3 years required to complete the remediation.
“It takes into account the construction of the storage facility. The remediation efforts on the heap leach pad, et cetera. If you look at the financials, the care and maintenance costs in the first quarter are around, I think, $17 million from memory,” Antal specified.
Responding to a question about ongoing investigations and dialogue with government entities in the earnings call, Antal also highlighted the presence of numerous government stakeholders at Çöpler mine.
“I can’t comment specifically on the ongoing investigations and the legal proceedings. But, yes on the ground, we have — I think we mentioned it last quarter when the incident happened,” Antal said. “We have many government stakeholders actually at Copler from the various different ministries that we would normally interacting on mining — normal mining activities as well as other ministries that have been a great assistance on the ground for us.”
As part of the remediation plan, the heap leach pad at Çöpler will be permanently closed, with no further heap leach processing.
Operationally, in the first quarter of 2024, SSR Mining produced 101,873 gold equivalent ounces at a cost of sales of $1,166 per payable ounce and AISC of $1,569 per payable ounce, including care and maintenance costs at Çöpler. This compares to last years production of 146,894 gold equivalent ounces at a cost of sales of $1,289 per payable ounce and AISC of $1,693 per payable ounce.
Excluding Çöpler’s production, the company expects consolidated production from Marigold, Seabee, and Puna to be between 340,000 to 380,000 gold equivalent ounces in 2024.
SSR Mining reported an attributable net loss of $287.1 million in the first quarter of 2024, primarily due to reclamation and remediation costs, non-cash impairment charges, and costs related to the Çöpler incident. Adjusted attributable net income was $22.5 million, reflecting operating cash flow of $24.6 million.
This comes from a quarterly revenue of $230 million, compare to Q1 2023’s $314 million. As of March 31, 2024, SSR Mining maintained a cash and cash equivalent balance of $467.0 million and no borrowings outstanding on its $400 million revolving credit facility.
Resumption of operations at the Çöpler mine is said to be contingent upon obtaining necessary regulatory approvals, including Environmental Impact Assessment (EIA) and operating permits. Initial ore processing is expected to occur exclusively through the sulfide plant once operations resume.
SSR Mining last traded at $7.37 on the TSX.
Information for this briefing was found via Sedar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
