Aura Minerals Inc. (“Aura” or the “Company”) today provided an update on the current status of operations at its properties in light of, as well as initiatives it is undertaking in response to, the ongoing global COVID-19 pandemic (the “Pandemic”).
Aura remains committed through the Pandemic to uphold its most important values, which, under the 360° Mining concept, include its commitment to act responsibly, to continue to build respectful and sustainable relationships with the communities around which it operates and to meet the highest safety standards for its employees. Through the Pandemic to date, Aura has undertaken a wide range of measures not only to help curtail the spread of COVID-19, but also to actively contribute to improving conditions for the surrounding communities where it operates.
San Andres Mine in Honduras
As previously announced, mining operations at San Andres were interrupted pursuant to orders of the Honduran government in response to the Pandemic and Aura has reduced its workforce to the minimum in order to maintain tailings and continue to satisfy environmental requirements in connection with operations and other critical activities at the mine. On May 3, 2020, the Honduran government issued a new order in which it extended its previously-issued decree until May 17, 2020.
At this time, the Company expects that the interruption at San Andres will have a material impact on the Company’s financial performance during the first half of 2020, and will keep the market informed on a timely basis.
Notwithstanding its operational challenges, Aura has continued to give back to the local community, having donated food to more than 1,000 families, medicine and medical supplies to 6 local health centers, biosafety equipment to 8 health control checkpoints and other donations of personal protective equipment to the national police force, local reporters and nursing homes, among others. Meanwhile, together with local community leadership, authorities, our employees and other local businesses, Aura has been working on a detailed plan for the gradual and safe restart of operational activities when permitted. Aura has also implemented a series of measures to ensure safe conditions for our workers and restricted high-risk individuals from entering the site, including the provision of health questionnaires, temperature scanning, mandatory quarantine for high-risk individuals and the development of a software tracking system that will provide reliable information on interactions among employees at the site called “Aura Tracker”.
Aranzazu Mine in Mexico
On March 31, 2020, the Mexican government issued a decree requiring the suspension of all non-essential activities in the private and public sectors until April 30, 2020, which has since been extended until May 30, 2020, but which could be anticipated to May 18, 2020 to municipalities with low or no cases, what is, to date, the case of the municipality where our operation is located. The decree allows businesses to maintain critical activities which, if interrupted, could result in potentially irreversible damage that prevents their further continuation. Accordingly, the Company suspended all non-essential operations at Aranzazu while maintaining only critical activities which are required to prevent safety and/or environmental risks from materializing and potentially irreversible damage occurring that could prevent our operations from continuing.
Despite these operational restrictions, there has not been a material impact on the mine’s operational or financial performance to date due to accumulated inventory at the site. Aura continues to monitor the situation closely and will keep the market informed on a timely basis.
In addition to implementing all measures required by the governmental decree, the Company has also helped implement measures together with municipal authorities for Concepcion del Oro such as a screening checkpoint for all those entering the city and contracting the local workforce to produce additional face masks for ongoing essential activities. In addition, Aura is assisting with other initiatives designed to support the community in this difficult time, including by providing canteens, transportation vehicles and health questionnaires, facilitating temperature scanning and the use of screening checkpoints, hiring additional medical personnel and supplying COVID-19 test kits.
Ernesto/Pau-a -Pique Mine in Brazil
Our Ernesto/Pau-a-Pique mine has been allowed to continue operations as governmental authorities have deemed mining as an essential industry. Despite this, the broader Pandemic impact has led to certain shipping delays and the need to establish new export routes for product coming out of the mine, which has been resolved to date. Aura continues to monitor the situation closely and does not anticipate there will be a material impact on the mine’s expected operational or financial performance as the second quarter of 2020 progresses.
In addition, Aura has implemented a series of initiatives to reduce risks among its employees at the mine, which includes the implementation of Aura Tracker; reducing its workforce on site by 20% and allowing such personnel to work from home, increasing the number of buses transporting employees to allow for a 50% reduction in seats, acquiring 2,000 COVID-19 test kits and mandating the use of masks on site at the mine. In addition, Aura extended its work with local communities and has donated masks and gloves to the state police force and personnel at the local detention center, in addition to purchasing 6,000 masks from local projects which were also donated and distributed to families in need, among other initiatives.
Aura’s Other Projects and Personnel
At this time, our exploration activities for the Almas, Matupa and Gold Road projects have not been materially disrupted as a result of the Pandemic, and Aura continues, at a reduced workforce, to conduct exploration work at these properties while complying with all applicable regulations and undertaking measures necessary to ensure a safe work environment for employees and contractors.
With respect to the Gold Road mine in the United States, Aura has promoted social distancing and implemented a work from home policy for those able to perform their jobs outside the mine site. In addition, Aura has implemented extensive cleaning services, banned in-person meetings with large groups and implemented measures to restrict high-risk individuals from entering the site. Once in production, Aura will implement additional measures consistent with those already implemented at our producing properties if still required in response to the Pandemic.
Although the operational challenges arising from the Pandemic have negatively impacted cash flows, Aura’s solid capital structure and strong working relationships with financial institutions in the jurisdictions in which it operates has allowed the Company to maintain strong liquidity through the Pandemic.
Rodrigo Barbosa, the Company’s President and CEO, said: “Aura Minerals, and our families, are aware of the impact that COVID-19 is having on our communities, our stakeholders and the world as a whole. Moreover, the mining sector, in most cases, involves working in remote areas among communities with poor access to basic infrastructure, education and health resources, and such access has been further constrained by the COVID-19 situation. Our priority today lies with keeping our people safe, with the communities in which we work, and in doing our part to help them. That being said and although we have been impacted by this pandemic, we find ourselves to be fortunate enough to have the team and the financial resources that we do such that our cash position remains strong. Aura has been, and will continue, supporting these stakeholders to the best of our abilities. We remain active in our communities and are reaching out in each one, doing what we can to provide support and assistance. We will work together as one, seeking to apply best practices and procedures and find the best solutions to challenges that arise through this difficult experience and, together, we will all get through this.”