Morien Resources Corp. ("Morien" or the "Company") (TSXV:MOX),
wishes to set the record straight and caution investors regarding
misleading statements recently published by various Canadian media
outlets in regard to an announcement by Kameron Collieries ULC
(“Kameron”), owner of the Donkin Coal Mine (“Donkin”, or the
“Mine”) in Cape Breton, Nova Scotia.
On Monday, March 30, 2020, Kameron announced
that it has ceased production operations at the Donkin Mine due to
adverse geological conditions. Since that announcement, the
Canadian Press, the CBC and allNovaScotia have made pronouncements
that the Mine has been closed “permanently”. Additionally,
Halifax’s Chronical Herald made an initial report (since corrected)
that the Donkin Mine was “for sale”.
Investors should be aware that these
pronouncements are inaccurate in describing the current situation
at Donkin. It is important for investors to know that none of
the materials provided by Kameron nor spoken by Kameron
representatives mentioned the words “permanently” or “for
sale”.
State of Operations at
Donkin
The description of the state of operations at
Donkin does not lend itself to one or two words. Since
commencing production in February 2017, there have been 12
incidences where material has fallen from the ceiling (roof) of
certain sections of the tunnel operations. These occurrences
are very common to underground coal mining operations. In
Donkin’s case, all of the roof falls occurred in areas where the
risk was already identified by Kameron, and precautionary measures
had been taken. That is the reason why no one has been
injured from a roof fall at Donkin. Following the last roof
fall on February 13, 2020, a Kameron spokesman said – "the miners
are trained to identify signs of [rock] stress. This wasn’t a
sudden event. There were signs of this.”
From 2016 when the Mine development and tunnel
refurbishment started, to the end of 2018, Kameron’s mine injury
rate has been 75% less than the U.S. national underground coal mine
injury rate, and none of those injuries were related to a roof
fall. In 2018, Nova Scotia saw 5,314 Time Loss Claims across
19 sectors, with Donkin only accounting for 0.06% of those
claims.
When roof falls occur, best practices have the
operator (Kameron) and the provincial regulator (Nova Scotia
Department of Labour and Advanced Education – “NS LAE”) work
jointly to assess the cause and determine the appropriate
remediation procedures. This procedure has been applied
before and will continue to be applied should any future events
arise.
The most recent rock falls in February took
place in an area where a localized zone of roof geology differed
from the typical rock strata of the mine in that it was
weaker. Work subsequently stopped in that area of the Mine.
Following standard procedure, Kameron and NS LAE jointly
commenced an assessment of this area of adverse geology with a plan
to devise a remediation program for this specific zone and any
other future similar occurrences.
The Donkin Mine is the first underground coal
mine to operate in Nova Scotia since 2001. As such, NS LAE
has been working with the outside assistance of experts from the
U.S. Mining Safety and Health Administration (“MSHA”) to provide it
with advanced expertise to properly assess any revisions to
Kameron’s ground control procedures at the Mine. According to
MSHA, who have toured the Mine in the past, Kameron’s previous roof
control procedures at Donkin “actually exceeded industry best
practices for safety.”
However, following the latest February roof
falls, as a result of Covid-19 related travel restrictions, MSHA
consultants have yet to be available to assess the geology in the
area of the roof falls, Kameron’s ground control procedures and
provide NS LAE with advice.
Mine safety is of paramount importance to
all. The assessment and prospective resolution of the adverse
geology at Donkin will take substantial efforts by the NS LAE, MSHA
experts, Kameron and other professionals in this field.
This process will take some time as the utmost
care, caution and expertise must be deployed. It would not be
accurate to categorize the time to conduct these steps as short or
to say that Donkin is “temporarily” suspended.
However, it is highly inaccurate to state Donkin
is “permanently” closed and “for sale”. Permanent closure
brings the removal of mining equipment and the sealing of the
tunnels. None of that is happening at Donkin. Until
such time as the analysis has been completed and decisions have
been made, one cannot apply the “permanent closure” label to Donkin
operations, and subsequent to Kameron’s media statement to idle the
operation, it has publicly stated the Mine is “not for sale.”
Morien will provide additional information on
the Donkin Mine as it becomes available.
Dawson Brisco (CEO and President) and
John Budreski (Executive Chairman) would be pleased to discuss
these matters with investors by way of emails or at the phone
numbers listed below.
About Morien
Morien is a Canadian based, dividend paying,
mining development company that holds royalty interests in two
tidewater accessed projects. Before going on care and
maintenance, the Donkin Coal Mine commenced production in 2017 and
the Black Point Aggregate Project is progressing toward a
development decision. Morien’s management team exercises
ruthless discipline in managing both the assets and liabilities of
the Company. The Company’s management and its Board of
Directors consider shareholder returns to be paramount over
corporate size, number or scale of assets and industry
recognition. Subsequent to Morien’s Normal Course Issuer Bid
purchases in March 2020, the Company has 52,419,114 issued and
outstanding common shares and a fully diluted position of
55,149,114. Further information is available at
www.MorienRes.com.
Forward-Looking Statements
Some of the statements in this news release may
constitute "forward-looking information" as defined under
applicable securities laws. These statements reflect Morien's
current expectations of future revenues and business prospects and
opportunities and are based on information currently available to
Morien. Morien cautions that actual performance will be
affected by a number of factors, many of which are beyond its
control, and that future events and results may vary substantially
from what Morien currently foresees. Factors that could cause
actual results to differ materially from those in forward-looking
statements include risks and uncertainties described in Morien’s
annual information form filed with the Canadian Securities
regulators on SEDAR (www.sedar.com) on April 26, 2016. Morien
cautions that its royalty revenue will be based on production by
third party property owners and operators who will be responsible
for determining the manner and timing for the properties forming
part of Morien’s royalty portfolio. These third party owners
and operators are also subject to risk factors that could cause
actual results to differ materially from those predicted herein
including: volatility in financial markets or general economic
conditions; capital requirements and the need for additional
financing; fluctuations in the rates of exchange for the currencies
of Canada and the United States; prices for commodities including
coal and aggregate; unanticipated changes in production, mineral
reserves and mineral resources, metallurgical recoveries and/or
exploration results; changes in regulations and unpredictable
political or economic developments; loss of key personnel; labour
disputes; and ineffective title to mineral claims or
property. There are other business risks and hazards
associated with mineral exploration, development and mining.
Although Morien believes that the forward-looking information
contained herein is based on reasonable assumptions (including
assumptions relating to economic, market and political conditions,
the Company’s working capital requirements and the accuracy of
information supplied by the operators of the properties in which
the Company has a royalty interest), readers cannot be assured that
actual results will be consistent with such statements.
Morien expressly disclaims any intention or obligation to update or
revise any forward-looking information in this news release,
whether as a result of new information, events or otherwise, except
in accordance with applicable securities laws. All dollar values
discussed herein are in Canadian dollars. Any financial
outlook or future-oriented financial information in this news
release, as defined by applicable securities laws, has been
approved by management of Morien as of the date of this news
release. Such financial outlook or future-oriented financial
information is provided for the purpose of providing information
about management's current expectations and plans relating to the
future. Readers are cautioned that such outlook or
information should not be used for purposes other than for which it
is disclosed in this news release.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
For more information, please
contact:
Dawson Brisco, President & CEOPhone: (902)
403-3149 dbrisco@MorienRes.com
or
John P.A. Budreski, Executive ChairmanPhone:
(416) 930-0914
www.MorienRes.com
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