No buyer yet, Harte Gold asks for extension
Troubled Harte Gold (TSX: HRT) announced today it is extending its legal negotiations with its lenders to review its options and find a buyer.
Harte Gold holds a 100% interest in the Sugar Zone mine located in White River, Canada. The Sugar Zone Mine entered commercial production in 2019.
The company announced a forbearance agreement with BHP Paribas in July.
The company said it is carrying out a sale and investment solicitation process. Even if a sales goes through the, a transaction would not "...result in a transaction which would provide any value for holders of Harte Gold's equity securities."
The company said it has deferred mitigation measures to sustain cash, as well as sustaining and expansion capital expenditures.
"However, based on the company's current cash flow forecast, the company will require additional financing prior to the end of 2021 in order to continue operations and conclude the Strategic Review Process. However, there can be no assurance that the company will obtain the required financing or what the terms of such financing might be," writes the company.
The company has $11.4 million in cash, according to its Q3, which was released today.
Total production of 15,260 oz Au for Q3 2021 compared to 11,283 oz Au in Q2 2021 and 6,218 oz Au in Q3 2020.
Harte wrote that it will require "...additional funding prior to the end of 2021 to continue operating and to conclude the Strategic Review Process."
"As outlined in the press releases dated May 13, 2021 and August 4, 2021, there are critical areas of the operation that must be addressed in order to see sustainable, consistent improvements in mine throughput and production. These areas include bolstering the mine workforce, accelerating infill drilling, accelerating mine capital development, and reinforcing the underground equipment. These initiatives require additional capital and, in the absence of securing the financial liquidity to address these initiatives, the Company continues to expect that future production will be negatively impacted."
By Michael McCraeFor Kitco News
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