NEW YORK Baja Mining Corp. has reported a $151.8-million loss in the third quarter, down from net income of $78.3 million in the same period last year, as struggles continue at its flagship Boleo Mine, which halted construction after a worker died at the facility Thursday.
Construction at Vancouver, British Columbia-based Bajas flagship copper-cobalt-zinc-manganese minewhich faces more than $440 million in overrun costsremained suspended as of Friday.
The mine, in Baja California Sur, Mexico, was originally tagged with a construction cost of $1.17 billion, but that amount was reassessed at $1.67 billion in June, according to the company.
Bajas ownership stake in subsidiary Minera y Metalurgica del Boleo SA de CV (MMB) was reduced to 49 percent in August, when the co-owner of the mine, a Korean consortium, supplied $90 million in funding to bail out the project (amm.com, Oct. 25).
If Baja makes no contribution to the next stage of funding, its interest in the mine will be reduced to 10 percent, the company said Thursday.
Baja attributed its third-quarter losses to the transition of shares to the consortium, resulting in a loss of $115.8 million.
The company secured a further extension of a standstill agreement from lenders as well as an additional $84 million from the consortium earlier this month, enabling it to continue construction of the mine until Nov. 20 (amm.com, Nov. 7).
"Once the companys interest is below 20 percent, it may be considered that the company does not exercise significant influence over MMB," the company said.
The Boleo Mine has a measured and indicated ore resource of 265 million tonnes and an inferred resource of 160 million tonnes, according to Bajas website.
Earlier this week, Baja appointed interim chief executive officer and chairman Thomas Ogryzlo as interim chief financial officer.
Ogryzlos appointment follows the transfer of former Baja chief financial officer Rowland Wallenius to MMB. Bajas board is now considering recruiting a new permanent chief financial officer.
"Baja still owns 49 percent of the Boleo project, and it will keep its position until the Korean consortium will commit to State Two funding," she said.