Equinox Gold Suspends Gold Mining Plant Due to Delays in Bidding for Dam Raise Works

Without a Deadline for the Dam Raise Works of the MRDM Mining Project, Equinox Gold Announced the Temporary Suspension of Gold Mining at the Site, as It Needs to Ensure Operational Safety in the Region

Equinox Gold announced on last Monday (05/16) the suspension of its gold mining project in Riacho dos Machados, Minas Gerais. The decision was made after the company requested bids for the dam raise works in the region but has not yet received results. Thus, the company determined that the best course of action to ensure safety in the area was to temporarily halt operations at the project.

Gold Mining Project in Riacho dos Machados, MG, Is Suspended by Equinox Gold Following Delays in Bidding for Dam Raise Works

Equinox Gold is one of the largest companies in the gold mining sector and currently has seven operating mines in four countries: Brazil, Canada, the United States, and Mexico, in addition to other projects under development in Brazil. Among the national projects, the Riacho dos Machados Mining (MRDM) was suspended this Monday by the company, and gold production will be halted indefinitely. 

The decision was made after Equinox Gold was unable to secure the necessary bids to carry out the dam raise works at the gold production plant. Without a timeline for the project, the company cannot continue mining in the region in a fully safe manner. Therefore, Equinox Gold chose to halt production until it can secure the bid and complete the dam works, which are essential to ensure safety and prevent disasters such as tailings overflow at the site. 

Furthermore, the company stated that discussions with regulatory authorities are ongoing, and the MRDM is awaiting environmental agency authorization for the mobilization and immediate commencement of the dam raise works. Thus, the expectation for the resumption of gold mining in northern Minas Gerais is within the next two months. The company is only waiting for environmental approval, and if it cannot secure it within the expected timeframe, it will need to continue the suspension of the mining project until the dam works are completed. 

Dam Raise Works Must Be Performed Constantly and Miner Excludes Production of Up to 80 Thousand Ounces of Gold Due to Lack of Forecast for the Construction

Equinox Gold commented on the importance of performing dam raise works for the project and stated that “The dam raises for the tailings of the Riacho dos Machados Mining are carried out constantly, throughout the mine’s operational life, and the structure is operated and designed according to industry best practices, being regularly inspected and audited by independent parties, regulatory bodies (ANM), and licensing authorities (SEMAD/MG).”

Thus, without a concrete timeline for the start of works at the site, the company has temporarily excluded the expected production of MRDM in 2022, estimated between 70 thousand and 80 thousand ounces of gold, equivalent to approximately 11% of production. Equinox Gold also stated that new loss projections due to the plant’s suspension will be disclosed after a forecast for the start of works at the site over the next two months. 

Finally, the company reported that since June 2021, it has been discussing with the environmental agency the continuity of the raise by the downstream method up to the level already covered in its environmental license, but has not yet secured approval for the completion of the project.