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PureGold Mining launches strategic review of its underperforming mine
The “turnaround plan” for a struggling Red Lake gold mine may include a sale of the company and its underground operation in northwestern Ontario.
PureGold Mining has initiated a strategic review process that could involve a potential sale or merger of the company, a sale of all or part of its mine, or other long-term financing options. It’s been a steep decline for the Vancouver-based mining startup company.
Amidst high hopes in 2021, the PureGold Mine entered commercial production last August on the site of the former Madsen Mine, located a few kilometres southwest of the town of Red Lake. But by the fall months, the operation began falling short of gold production targets, particularly on the high-grade ore side.
These shortfalls were blamed on underground mine construction delays, bad scheduling, “insufficient geological information” for the stopes about to be mined, equipment issues, and “strategic misalignments,” resulting in a change of senior management. The year-end financials showed a $34.9-million loss
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