Sierra Rutile Holdings Limited has taken a significant step by announcing the suspension of its operations in Area 1 and the commencement of a redundancy program. This decision follows the company's previous announcement on February 29, 2024, regarding its 2023 annual financial report. The company has halted all mining and processing activities at its Area 1 operations and will now begin engaging with the Government of Sierra Leone and its staff. Approximately 25% of the workforce, including expatriates, are expected to receive redundancy notices by the end of March 2024.

The rationale behind this action, according to the company, is a direct response to the prevailing weak market conditions and uncertainty surrounding the fiscal regime applicable to Area 1 operations. Despite this, Sierra Rutile Holdings Limited remains hopeful that the suspension will be temporary. They aim to reach an agreement with the Government of Sierra Leone on a suitable fiscal regime that would support production in conjunction with favorable Rutile market conditions.

However, if an agreement cannot be reached in the coming weeks, the company may be compelled to consider a complete closure of mining operations at Area 1. This decision would significantly affect the majority of the remaining workforce, as well as potentially impact a substantial number of personnel employed by various contractors.

In the interim, the company intends to continue monetizing its finished goods inventories as part of its regular business operations. The proceeds generated will be utilized to fund statutory termination benefits for redundant staff members.

Meanwhile, Sierra Rutile Holdings Limited remains committed to advancing the definitive feasibility study for the Sebehun project. The results of this study are anticipated to be announced in April 2024. In the event of a full closure of Area 1 operations, the company may undertake a strategic review of the Sebehun project with the aim of maximizing value for all Sierra Rutile stakeholders.

Sierra Rutile Holdings Limited (SRX) operates as a multi-mineral sands operation spanning the Bonthe and Moyamba Districts in Southern Sierra Leone. With over 2000 employees, it stands as one of the largest private employers in Sierra Leone. Additionally, the company holds ownership of rutile deposits, including the Sebehun project.