Mr. Mark Turner reports
LUNDIN MINING PROVIDES UPDATE ON READINESS AND RESPONSE TO COVID-19, AND OPERATIONAL AND GUIDANCE UPDATE
Lundin Mining Corp. and each of its operations are continuing to manage and respond to COVID-19 within the framework of the company's pandemic response plan, recommendations of health authorities, and local and national regulatory requirements.
COVID-19 readiness and response update
COVID-19 is a global threat, which requires a united response from governments, industry and communities to ensure the safety, health and well-being of all. Lundin Mining has taken numerous steps to ensure needs are being addressed in the communities and regions in which it operates. Its operations have shared action plans and preventative measures being implemented while seeking and considering input from employees, unions, contractors and communities to ensure the company is delivering responsive actions consistent with broader efforts. Further, the company is actively providing emergency support in the form of community donations of emergency financing and supplies. These efforts will continue to be focused on reducing the spread of the virus and supporting local health infrastructure.
Across Lundin Mining, the company continues to identify and implement measures to protect its work force and communities. The company has implemented a number of measures, including, but not limited to:
All operations and offices have implemented travel restrictions, surveillance, monitoring and response plans to reduce the risk of COVID-19 exposure and outbreak, including health screening of contractors, visitors and employees, when appropriate.
Employees and contractors who have had incidental contact or exposure to someone who has been diagnosed with the COVID-19 virus, as well as those who have travelled internationally, and at some operations domestically, have been instructed to stay at home for 14 days regardless of whether they are showing symptoms. Suspected cases are being closely monitored and reported to health authorities, where appropriate.
- The company is taking steps to limit visitors, contractors and employees to its operations and, where necessary, temporarily suspending activities. On March 16, 2020, the company announced that construction and commissioning of its zinc expansion project at Neves-Corvo would be placed on hold to reduce the risk to its local communities, employees and contractors, as the work force for the project includes many contract employees who travel from other regions of Portugal and internationally. Additionally, at several of its operations, the company has identified and curtailed non-essential activities, such as waste mining and exploration, to reduce exposure risk with less people at and commuting to site.
A portion of the company's work force is working from home to reduce interactions through commuting or close contact with co-workers. This group, at certain operations, includes employees that fit COVID-19 risk groups determined by public health authorities. The company has temporarily closed many of its community and satellite offices while continuing to provide services virtually.
Across all operations, the company has limited access and implemented new procedures for areas where large groups congregate like canteens, cafeterias and change rooms. The company has also enacted measures to promote social distancing, including modifying transportation and shift change routines. Awareness campaigns are being carried out actively with employees and contractors.
Operational and guidance update
There has been no material impact to production or shipment of concentrate from any of the company's operations to date as a result of COVID-19. Additionally, there has been no significant disruption to the supply chain of the company's operations. Lundin Mining and each of its operations continue to monitor and implement business continuity measures to mitigate and minimize any potential impacts of the pandemic that might emerge on its operations, supply chain and commercial activities.
As previously announced on March 16, 2020, construction and commissioning activities directly related to the zinc expansion project at the Neves-Corvo operation in Portugal have been temporarily suspended until further notice. The company is continuing to assess the impacts of the temporary suspension of the project on the timelines and budget, and will provide an update once the assessments have been completed. Previously provided zinc production and capital cost guidance for the Neves-Corvo operation, which includes the zinc expansion project, should no longer be relied upon.
Additionally, in preparing for what could be a sustained period of depressed prices for its primary metals, the company is actively identifying and reviewing measures across its operations and offices to reduce operating costs and defer discretionary capital and exploration expenditures. The range of measures being assessed includes possible curtailment of non-essential projects and studies, deferral of waste mining, reduction in exploration spending, and mine and processing plan modifications. As such, current production, C1 cash cost, exploration spending and capital cost guidance for all operations is under review, and may be amended to reflect necessary modifications to the company's plans. The company expects to provide an update on these measures and any resulting revisions to guidance not later than the release of its first quarter 2020 results.
Lundin Mining is in a strong financial position. The company's net debt position as at March 23, 2020, was approximately $95-million, including $390-million of cash on hand. Included in the net debt position, $375-million had been drawn on the company's secured revolving credit facility, which has borrowing capacity of $800-million, with a $200-million accordion option to total $1.0-billion, and term to August, 2023.
About Lundin Mining Corp.
Lundin Mining is a diversified Canadian base metal mining company with operations in Brazil, Chile, Portugal, Sweden and the United States, primarily producing copper, zinc, gold and nickel.
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