Eastern Goldfields suspends operations

Struggling gold producer Eastern Goldfields has suspended all mining operations, with the company confirming that nearly 40 employees have been made redundant.

Last month, Eastern announced it had scaled back operations while it completed a strategic review of its business and searched for a recapitalisation deal.

The company said today all of its Davyhurst mining operations had been temporarily suspended.

“As a result of the temporary suspension, approximately 20 operational staff have been made redundant and approximately 16 corporate and administrative staff,” Eastern said in a statement to the ASX.

“A number of contractors have been stood down.

“The company will continue to produce gold in the short-term by removing all gold-in-circuit.

“The company considers these operational decisions to be prudent in the short-term as the company continues its efforts to finalise the proposed recapitalisation fundraising.”

The news comes after the gold miner’s executive chairman and largest shareholder Michael Fotios resigned, along with director Alan Still, last week.

The company also said last week it was in advanced discussions with potential investors regarding a capital raising.

Shares Eastern have been suspended since July 23 while it searches for a funding deal.