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Gascoyne Resources taps Macquarie for advice on corporate, financial matters

Greenhouse gas and gold mines Nearly 1 ton of CO2 emitted per ounce of gold produced in 2019

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Gascoyne Resources taps Macquarie for advice on corporate, financial matters

Gascoyne Resources Ltd. confirmed Jan. 14 that it tapped Macquarie Capital (Australia) Ltd. as its financial adviser.

The Australian wrote in a same-day report that Gascoyne hired Macquarie amid concerns that the company could face a takeover below its actual value following recent issues at its flagship Dalgaranga gold mine in Western Australia and instability on its board.

The company, however, said Macquarie was hired to advise the miner "on a number of corporate and financial matters" following a material fall in its share price during the December quarter of 2018.

Gascoyne added that the advice forms part of the board's ongoing efforts to maximize shareholder returns, while improving Dalgaranga's operating performance remains its key focus.

The company's share price took a hit in 2018 due to ongoing operational challenges at Dalgaranga and recent departures from its board. The share price of 15.5 Australian cents at the close of trade on Jan. 11 gives the company a market capitalization of just under A$80 million.

In late December 2018, Gascoyne slashed the 2019 production guidance for Dalgaranga to between 92,000 and 102,000 ounces at all-in sustaining costs of between A$1,220 and A$1,320 per ounce. The ramp up at the mine suffered from lower-than-forecast gold grades from the Gilbeys and Golden Winds pits, as well as due to temporary setbacks with the processing plant.

The previous guidance in August 2018 stood at 105,000 to 115,000 ounces at AISC of A$1,200/oz to A$1,300/oz.

In late October 2018, Mike Dunbar and Ian Murray resigned from the company's board. Murray's resignation as the nonexecutive chairperson just after a few week of his appointment was particularly damaging, following which Gascoyne shares more than halved.