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Great Basin’s mining operations underperformed due to problems at its two principal projects, including the Burnstone mine in Mpumalanga province, South Africa, shown here.

Great Basin Gold Ltd. stock dropped nearly 50 per cent in unusually heavy trading Wednesday after it disclosed a "liquidity challenge" due to operational problems that have resulted in an unexpected revenue shortfall.

Great Basin's stock was down 19.5 cents at 23.5 cents with more than seven million shares traded at mid-morning, making the Vancouver-based company the most active issue on the Toronto Stock Exchange at the time.

Prior to the announcement, Great Basin Gold had a total market value of about $138-million, based on Tuesday's closing stock price.

Great Basin said Wednesday that its board has struck a committee to look at strategic alternatives under new leadership.

Lou Van Vuuren, the company's chief financial officer, has been appointed interim chief executive officer. He replaces Ferdi Dippenaar, who has resigned as the company's president and CEO and also his seat on the board of directors.

Great Basin disclosed Wednesday that its mining operations underperformed in the second quarter due to technical and infrastructure issues at its two principal projects, the Burnstone mine and Hollister trial mining project.

As a result, Great Basin said it faced a "near-term liquidity challenge."

It will aggressively reduce costs and ask lenders to restructure the current term loan facilities to improve cash flow in the near term.

It's not necessary to reduce the carrying value of either project at this time, Great Basin said.

For the three months ended June 30, Great Basin generated $32.4-million of revenue – about the same as in the previous quarter and down from $56.7-million a year earlier.

Its net loss soared to nearly $22-million or five cents per share. That follows a loss of $17.8-million or three cents per share in the first quarter of 2012 and $1-million or zero cents per share a year earlier in the second quarter of 2011.

The former CEO said in a statement issued March 7 that the company was "proceeding well" to reach its ore development milestones in the second and third quarters of this year.

The statement said Great Basin had plans to deal with faulting and flooding at the Burnstone operation.

A few weeks later, Great Basin closed a syndicated financing, by selling shares and share purchase warrants. In total, including overallotment options, Great Basin raised $57.5-million in gross proceeds from the offering.