Nevada Copper files for bankruptcy, names new boss

Cash-strapped miner Nevada Copper (TSX: NCU) has filed for bankruptcy protection under Chapter 11, kicking off a restructuring process that will halt its Pumpkin Hollow mine.

President and chief executive, Randy Buffington, has resigned and the Canadian company has appointed mining veteran Tom Albanese, its lead independent director, as the new chairperson.

The move follows the Nevada Copper’s announcement on Thursday that it had “significantly scaled down operations” at the Nevada-based copper mine after failing to secure necessary funding to keep the project running.

Nevada Copper has asked for standard support measures for its employees and essential vendors as part of the Chapter 11 process. It is seeking approval from the court to continue paying employee salaries, wages and benefit programs regardless of any outstanding amounts prior to filing for bankruptcy. 

Interim financing

To ensure liquidity during the restructuring period, the miner has obtained a commitment for US$60 million in debtor-in-possession financing. Nevada Copper has requested that US$20 million of this amount be made available on an interim basis, subject to court approval.

The Vancouver-based miner said earlier this year it required additional funding to meet ongoing challenges at Pumpkin Hollow, where it restarted operations in the fourth quarter of 2023. Underground flooding, an incomplete ore handling system and unexpected bottlenecks caused repeated shutdowns of the processing plant.

Nevada Copper’s shares were unchanged on Monday in Toronto at 3¢ apiece, down more than 78% this year. Its market capitalization stands at $43.2 million.