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Canadian gold miner New Gold Inc. NGD-T has unexpectedly cut ties with its chief executive officer of more than four years and is providing no explanation for his exit.

Toronto-based New Gold said Wednesday that Renaud Adams, who’d been in the role since September, 2018, has stepped down as both CEO and a board member.

Mr. Adams will be replaced by Patrick Godin, the company’s chief operating officer since May.

Scotia Capital Inc. analyst Trevor Turnbull wrote in a note to clients that the announcement about change at the top was “abrupt” and the timing “unexplained.”

New Gold did not respond to a request for comment.

Mr. Adams, who came to New Gold with a long history in mining and a reputation for having strong technical skills, was recruited to try to turn around the Rainy River mine in northwestern Ontario. Not long after going into production in 2017, the mine’s grades came up short.

The company incurred large unforeseen costs after an engineering mistake came to light with the design of its tailings dam. Among Mr. Adams’s actions were stabilizing the balance sheet by executing on several asset sales, which helped reduce the company’s sizable debt load.

Related: Golden blunders: How a string of technical mishaps has hampered Canada’s junior gold miners

New Gold, however, has continued to struggle at Rainy River. The mine was hit with heavy rains in the second quarter of this year, which caused flooding in the open pit. The company’s second-quarter production came in far weaker than expected, and New Gold also cut its forecast for the rest of the year, as it set about pumping rainwater out of the pit.

Over the past few months, the company had managed to mostly get the mine back on track, and in September, New Gold’s management, including Mr. Adams, hosted Bay Street analysts at Rainy River to show progress made since the flood. There was no hint then that a management change was imminent.

Anita Soni, analyst at CIBC World Markets Inc., said in a note to clients on Wednesday that given the company’s flood problems at Rainy River appeared to be mostly in the rear-view mirror, the replacement of Mr. Adams at this juncture is a surprise. Looking ahead to next year, when the company is due to update the market on its operations and costs, Ms. Soni is concerned.

“We see added risk,” she wrote.

“With a new CEO, it is more likely that guidance for next year could be a headwind to the stock with a more conservative outlook.”

New Gold’s shares fell by 5 per cent to close at $1.50 apiece on the Toronto Stock Exchange on Wednesday. Its shares are down 21 per cent this year, which puts it in the bottom third of the TSX Global Gold Index in performance.

New Gold joins several large Canadian miners, including Agnico Eagle Mines Ltd., Nutrien Ltd. and Centerra Gold Inc., that have parted ways with their CEOs this year, but not explained what happened.

In the case of Agnico, The Globe and Mail subsequently reported that a clash between new CEO Tony Makuch and Agnico’s executive chairman, Sean Boyd, led to Mr. Makuch’s ouster after only 16 days.

At Nutrien, Mayo Schmidt’s imperious and brusque leadership style caused tension with subordinates and was a major reason for his firing as CEO, The Globe reported.

Follow Niall McGee on Twitter: @niallcmcgeeOpens in a new window

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