Panoramic Resources has announced its decision to suspend operations at its Savannah Nickel Project, in the face of dropping nickel prices.
In a separate statement released on 14 December 2023, Savannah announced its intention to trade-on the Savannah Nickel Project.
Whilst operations have continued, including a shipment of approximately 10,000t of nickel concentrate on 3 January 2024, nickel prices have continued to trend lower. After further engagement with major creditors, key suppliers and other stakeholders, the company’s administrators have determined that operations at the Savannah Nickel Project will be suspended in January.
As a consequence of this decision, the majority of the approximately 140 Panoramic staff on-site at the Savannah Nickel Project will be stood down and made redundant, some with immediate effect.
Panoramic has said that employees with unpaid accrued entitlements are creditors in a voluntary administration of a company with certain statutory priority entitlements ranking above the claims of unsecured creditors.
Panoramic has also said that employees may be entitled to make a claim against the Commonwealth Fair Entitlements Guarantee (FEG) scheme in the event of a shortfall in distributable funds available to meet certain of their entitlements, depending on the outcome of the administration process.
Panoramic Administrator and FTI Consulting Senior Managing Director, Daniel Woodhouse, said that while it was the company’s intention to continue to trade-on the Savannah Nickel Project and preserve the employment of the operating team as it explored opportunities for a sale or recapitalisation of the business, after consultation with major creditors and key suppliers it is apparent that the prospect of achieving a near-term turnaround of operations and finances is low.
“Given the near-term funding requirement for continued operations, we have made the difficult decision to suspend operations while the sale/recapitalisation process progresses,” Mr Woodhouse said.
“The administrators, with assistance from Treadstone Resource Partners, will continue a dual track strategy to sell or recapitalise the Panoramic business. This process will continue regardless of the Savannah Nickel Project’s operating status and look to realise the full value of the defined ore bodies, extensive infrastructure, and exploration potential of the project.”
