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Sierra seeks Yauricocha restart as Peru extends lockdown again

Sierra Metals (TSX: SMT) says it’s seeking approval to restart mining activities at Yauricocha as the country’s state of emergency and nationwide lockdown have been extended again, to June 30.
Sierra seeks Yauricocha restart as Peru extends lockdown again Sierra seeks Yauricocha restart as Peru extends lockdown again Sierra seeks Yauricocha restart as Peru extends lockdown again Sierra seeks Yauricocha restart as Peru extends lockdown again Sierra seeks Yauricocha restart as Peru extends lockdown again

Sierra Metals is hoping to restart its polymetallic Yauricocha mine in Peru

Staff reporter

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The company said some mining operations in the country had already received permission to restart under the phased lifting of restrictions, put in place to address the COVID-19 pandemic. 

"Sierra Metals continues to seek consent from the government to restart mining activities at the Yauricocha mine, given its remote location and implementation of strict health protocols exceeding government guidelines," it said.

In Mexico, where mining has been deemed an essential service, Sierra said it was recalling Bolivar mine employees for a COVID-19 screening process and quarantine period in preparation for a restart on June 1.

However its Cusi mine in Mexico remained on care and maintenance after a challenging quarter, where "the mine caught up on mine development" following a ground subsidence event in 2019 and management said this month it was evaluating the best path forward.

New CEO

Sierra last week appointed high-profile Peru mining executive Luis Marchese as CEO from June 1.

Marchese was Anglo American's Peru country manager and general manager of its Quellaveco copper project during his 22 years with the company.

He was also president of Peru's Society of Mining and Oil and Energy (SNMP) in 2017-2019.

Sierra said a handover period was underway and Igor Gonzales would resign as CEO, effective May 31.

Copper focus

Sierra said this month it was "trending towards copper as our main product", with the red metal representing 40% of its revenue in the March quarter.

It said despite a decline in metal prices, it had maintained a positive cash flow of US$15.7 million for the period and had $36.9 million in cash and equivalents at March 31.

Sierra's shares closed 4.5% lower yesterday to C$1.05, at the lower end of a 12-month range of 89c-$2.50, capitalising it about $171 million (US$123 million).

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