Key points
- Namibian Minerals said it never stated it was in talks to avoid voluntary liquidation, contrary to a Dow Jones article filed Feb. 6, 2001.
- The company confirmed it is examining financing options to address cash flow effects from the NamSSol accident and ongoing commissioning of the larger Nam 2 mining system.
- The NamSSol seabed crawler was damaged when a mine face collapsed on it, its upper chassis parted during recovery, and attempts to retrieve the undercarriage from the ocean floor using specialist divers were terminated.
- A replacement undercarriage is expected to take about five months to build and commission at a cost of up to $1.5 million (U.S.), and the company is pursuing an insurance claim covering the loss.
Contrary to a Dow Jones news article filed Feb. 6, 2001, Namibian Minerals has never stated that it is in talks to avoid voluntary liquidation.
The Dow Jones article correctly reported that the company is examining its financing options to deal with the cash flow affect while production is disrupted following the NamSSol accident and while the new larger Nam 2 mining system continues commissioning. The company has previously announced in Stockwatch Jan. 22, 2001, that it is monitoring its cash flow requirements.
Last month the company announced that its NamSSol seabed crawler had been damaged when a mine face collapsed on to the tool. During subsequent recovery the upper chassis parted, leaving the undercarriage on the ocean floor. Subsequent attempts to recover the undercarriage using specialist divers and equipment have been terminated. The company expects a replacement undercarriage would take approximately five months to build and commission, costing up to $1.5-million (U.S.).
The company has comprehensive insurance cover for material loss and/or damage to NamSSol and ancillary equipment, as well as for operating costs and expenses, including loss of profit, and is pursuing this claim.
“With insurance, the net effect on Namco’s bottom line in the mid-term should be minimal. Of course the company’s short-term cash flow is affected by the loss of the NamSSol production system. We are focused on strengthening our financial position through this interim period, pending Nam 2’s buildup of production and settlement of our insurance claim,” said chairman and chief executive officer Alastair Holberton.
WARNING: The company relies upon litigation protection for “forward-looking” statements.
