This is due to the delay in the signing of the EPC contract for the port and rail infrastructure for the Mbalam‐Nabeba iron ore project, which was expected to be signed during the December 2015 quarter, and the subsequent delay this will create in finding an equity partner for the mines.
Sundance said in its quarterly activities report for the year ended 31 December 2015 that these cost reduction measures align the company’s cash position with essential needs whilst retaining the ability to advance the project as soon as the EPC contract has been signed.
The cost reduction measures include a significant scale-back of employees, overheads and activities in Perth, Cameroon and Congo with a planned 80% reduction from the previous spend. Effective 1 February 2016, approximately 60 personnel across Perth, Cameroon and Congo will be made redundant resulting in less than 10 employees remaining (two in Perth with eight in Cameroon and Congo).
Sundance has however retained the services of the Cam Iron CEO, Serge Asso’o, the Congo Iron CEO, Emmanuel Yoka; and the Sundance CEO, Giulio Casello. The retention of these employees enables the organisation to focus on conserving expenditure whilst driving the advancement of the Mbalam‐Nabeba iron ore project, as these employees retain knowledge and history of the project and relationships with each government.
The key task of the remaining personell and CEO’s will include:
- Protecting the intellectual property and assets of Sundance;
- Maintaining relationships with the governments of Cameroon and Congo;
- Assisting the Government of Cameroon as required to progress the funding and signing of the EPC contract for the port and rail; and
- Continuing the process of negotiating and then agreeing the terms of an equity investment into the Mine Infrastructure.