Cluff Gold SL restructures workforce following gold price drop
Cluff Gold Sierra Leone, a subsidiary of Amara Mining plc, has restructured its workforce at the Baomahun Gold Project in light of the falling gold price. The restructuring also came at a time when Cluff Gold SL had completed its drilling programme in advance of the feasibility study, which was released on 02 July 2013. (Photo: Country Manager of Cluff Gold SL, Alusine Jalloh)
Many of the employees were involved in the drilling programme or were support staff, so now the project has entered an evaluative stage, their skills were no longer required. However Amara remains committed to supporting the communities in which it operates, with initiatives such as the Eco-Livelihood Project and Planting Promise continuing to be funded by the company.
Amara is cutting costs across its other assets in West Africa and at its head office in London in order to weather the difficult market conditions caused by the falling gold price. At its peak in September 2011, gold was trading at US$1,900/oz, however last week it reached a recent low of below US$1,200, which directly affects Amara’s profitability. Amara has one small producing mine in Burkina Faso which funds all activities across the company in Burkina Faso, Ivory Coast, Sierra Leone and the UK.
Following the unexpected drop in the gold price, mining companies around the globe are being forced to close mines and cut costs wherever possible. At the current price, around half of South Africa’s gold mines are not expected to break even. Amara is not alone in reducing its workforce, with even the major gold producers cutting costs and halting expansion plans.
The Country Manager of Cluff Gold SL, Alusine Jalloh, confirmed the reduction in staff and that the company has grounded all vehicles that are not required for basic operations. However he reiterated the positive impact Amara will have on to Sierra Leone in the longer term:
“The feasibility study shows that Baomahun is a viable mine that can provide many benefits for the people of Sierra Leone, including jobs, skills and prosperity. However the current market conditions mean that it is difficult for companies like Amara to raise capital, which means it may take longer than anticipated to start construction and begin production. The company will continue to work closely with local communities though and keep the people of Sierra Leone up to date with developments.”
Cluff Gold SL is poised to be the first industrial gold producer in Sierra Leone.
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