Shares in Galantas Gold (TSX, LON:GAL) collapsed in London Monday after the Canadian miner announced it had halted expansion work at its Omagh gold mine as the Police Service of Northern Ireland (PSNI) said it was unable to guarantee it the necessary “anti-terrorism cover” for its blasting operations.
The Toronto-based company, which had has begun underground development at Omagh last month, was going to create 130 new jobs due to the expansion, but it now says it was reviewing potential redundancies with recently hired mine staff, and any new recruitment or ongoing investment had been “deferred”.
The stock plummeted on the news and it was down almost 33% to 4.65p at 1:41PM GMT, while it was trading 20% lower in Toronto at 9:38AM. PSNI told the company that due to resource constraints and competing priorities, it was currently only prepared to provide anti-terrorism cover for a maximum of a two-hour period, two days a week.
Such supervision, a regular duty of PSNI, is considered crucial to avoid that the transportation and use of certain rock breaking materials and explosives ends in hand of terrorists, the company said.
Galantas noted the PSNI was also requesting a “cost recovery agreement” for the limited protection and added the offered time was insufficient to sustain the development or operation of the mine.
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