Titan declares force majeure in wake of historic flooding
Titan Mining Corp. [TI-TSX] said operations at its Empire State mine (ESM) in Upstate New York have been temporarily suspended following historic flooding from Tropical Storm Debby. The company said there were no injuries to employees or damage to the mobile fleet.
However, despite efforts by mine personnel to divert water to mined out areas of the mine, flood water rose in the shaft above the crusher level, leading to electrical power failure in the mine.
“As of this morning (August 12, 2024), power has been partially restored to the underground and flood waters are receding,’’ the company said in a press release. “Once mining operations resume, ore will be stockpiled underground,’’ it said. “As a result of the flooding, the underground crusher and control room will require an electrical rebuild that is expected to take four to eight weeks, during which period, there will be no production of zinc concentrate.’’ Meanwhile, the company has declared force majeure for its contractual concentrate delivery obligations for the near term.
The flooding update came after the close of trading on August 12, 2024, when Titan shares close at 23.5 cents. The shares currently trade in a 52-week range of 48 cents and 20 cents.
Titan holds a 100% interest in the ESM. The underground mine and mill complex produces approximately 4.0 million payable pounds per month of zinc contained in concentrate.
During the rebuild period, Titan will continue to mine and stockpile ore underground. The company anticipates that stockpiling ore, coupled with the excess mill capacity will enable the company to meet budgeted production for the year. As a result, Titan’s production guidance for ESM remains unchanged.
Meanwhile, New York Governor Kathy Hochul declared a statewide State of Emergency in response to the flooding caused by Tropical Storm Debby. The company is in contact with the state and federal authorities regarding potential assistance to address business disruptions caused by the flooding.
Aside from the Empire State, the company’s assets include the Mineral Ridge property in Esmeralda county, Nevada. The Mineral Ridge Property is a fully-permitted mine and mill operation comprised of approximately 14,000 acres of patented, fee-owned, and unpatented mining claims which include certain water rights. Historically, the property has produced approximately one million ounces of gold from underground and open pit mining operations.
The project hosts a total measured and indicated resource of 349,500 ounces of gold. In a press release on August 31, 2020, Titan said it had signed an option agreement with Scorpio Gold Corp. [SGN-TSXV]. Terms of the agreement require Titan to spend US$35 million in staged expenditures over five years to earn an 80% stake in Mineral Ridge Gold LLC (MRG), an indirect subsidiary of Scorpio Gold which currently holds all of the Mineral Ridge Property mineral rights and water rights.