In response to the COVID-19 pandemic, Kirkland Lake Gold is reducing operations at Detour Lake Mine.
Along with the temporary reduction in operations Kirkland Lake Gold has suspended non-essential work at all operations and exploration activities across the company. Affected workers will be given two weeks paid leave.
The changes start today (March 23) and are in effect until April 30.
“COVID-19 represents an unprecedented challenge for people, governments and businesses worldwide. While none of our employees have tested positive for COVID-19, the actions we are taking represent our best judgment, based on what we know today, on how to responsibly protect our people from the pandemic. As always, the safety of our employees is our top priority. On a company-wide basis, we are introducing a series of health and safety protocols including medical screening, increased cleaning and hygiene and remote work and other forms of social distancing," said Tony Makuch, Kirkland Lake Gold president and CEO, in a news release.
"We are also discontinuing all non-essential work at our operations and suspending exploration activities across the Company. In the case of Detour, the increased risk represented by the remoteness of the mine and the camp environment requires a more extensive response. As a result, we are transitioning to reduced operations until April 30, 2020 in order to minimize the number of people required at site. We will continue to produce, though at lower levels, and will ensure critical tasks are completed such as managing water during the spring run-off and ongoing environmental management. It is not possible at this time to estimate the impact of reduced operations on Detour Lake’s 2020 production."
At Detour Lake, a remote camp northeast of Cochrane, it houses about 1,100 workers at a time. About 300 people are expected to stay on site for the essential activities during the reduced operations.
The activities that will continue are: processing the reduced feed from the open pit and stockpiles in the mill, managing water levels during the spring run-off, and environmental managment activities.
People not required for the activities will not be on site.
"In addition, workers from remote First Nations communities and those along the James Bay coast, as well as employees requiring airline transportation to get to and from the minesite, will also be advised to remain off site until the end of April. For workers affected by the move to reduced operations, the Company will provide paid leave for 14 working days, the equivalent of a month of normal pay," reads the statement.
Additional safety measures are also being implements for the camp operation.
According to the company, those include processes for the assessment, isolation and medical evacuation of employees, increased food and hygiene safety, and more frequent cleaning.
Along with the operational changes, Kirkland Lake Gold is ending its automatic share purchasing plan (ASPP), whcih was launched Feb. 20 in connection with its normal course issuer bid (NCIB).
“Turning to our NCIB, we have been very committed to buying back our shares through the NCIB, with a total of 10.4 million shares having been repurchased under the current plan to date for a total of $360 million (C$483 million). Given current global events, we believe it is prudent to maintain as much financial flexibility as possible. We continue to have a very strong balance sheet with close to $500 million of cash and no debt. To preserve our financial strength, we have elected to discontinue the ASPP, through which we were repurchasing approximately 103,000 shares per day on an automatic basis, outside of our discretion. We retain the option to repurchase shares through the discretionary component of the NCIB and will consider any future repurchases in relation to evolving global developments," said Makuch in the release.
