Nevada Copper improves balance sheet as ramp-up continues

Shares in troubled, fledgling producer Nevada Copper soared 25% yesterday as the company announced “transformative” balance sheet improvements as it continues to ramp up its Pumpkin Hollow underground mine.

Staff reporter
 Nevada Copper’s Pumpkin Hollow operation in Nevada

Nevada Copper’s Pumpkin Hollow operation in Nevada

The company said its largest shareholder Pala Investments was set to provide a further US$41 million through an amended credit facility, and its senior project lender KFW-IPEX Bank had agreed a "significant deferral and extension" of its debt facilities.

The company's new president and CEO Randy Buffington, who was appointed last week, said the improvements provided "significant additional runway" as the company moved to complete the ramp-up at the Nevada mine.

"The ongoing support of two of our major stakeholders provides further validation of the significant inherent value of our copper operations in Nevada and allows us to continue to pursue the growth potential embedded within our asset base," he said.

Buffington is the company's fourth CEO within a turbulent 18-month period, which has seen the fledgling operation hobbled by COVID-19 impacts, the need for a geotechnical review, subsequent financial difficulties, slow progress through a water-bearing dike and shipping delays.

It's aiming to reach its original target of a 5,000 tonne per day production rate, first slated for 2020, in the first half of 2022.

Pumpkin Hollow also hosts a fully permitted openpit project.

"There is a tremendous foundation to build on at Pumpkin Hollow and I am pleased to be leading the company towards realising its full potential as a mid-tier copper producer," Buffington said last week.

The company completed a one-for-10 share consolidation in September.

Its share price (TSX: NCU) has spanned C49c-$3.15 over the past year and gained 20c yesterday to close at 99c, capitalising Nevada Copper at $183 million (US$147 million).

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