The company in charge of the stalled Mt. Hope mining project is slashing executive salaries and looking for other ways to cut costs as it seeks new funding to one day get the mine in operation.
General Moly Inc. said it cut the cash compensation for its CEO and members of its Board of Directors by 25 percent, with other senior employees getting pay cuts of between 10 and 20 percent. The move comes as the company tries to find funding for the molybdenum mine outside of Eureka.
At the same time, General Moly said it is putting up cash and other incentives to keep key employees from leaving the company. They would get the payoffs if they stay through Jan. 15, 2015.
“As we continue to develop a full financing package that provides the best outcomes for our stockholders in the current market, the company is taking prudent steps to reduce planned expenditures that maximize our financial flexibility and secure readiness for the rapid start of construction activities at Mt. Hope,’’ said Bruce D. Hansen, chief executive officer. “Our carefully crafted program maintains liquidity by reducing engineering, administrative and procurement expenses, trimming our expenditures from $2-3 million per month to less than $1.5 million per month.”
Almost all activity at the mine has been halted in the wake of the collapse of a deal with a Chinese company earlier this year for a $665 million loan to develop the mine at Mt. Hope. Hansen said the company is actively pursuing a number of financial options, but said they will take some time to complete as planned.
“Given that the fully-permitted Mt. Hope project is construction ready and backed by off-take agreements and a strong joint venture partner, we believe the company is well positioned to executive full project financing,’’ he said.
Hansen said the company’s engineering at Mt. Hope had been six months ahead of construction activities and can be hibernated and resumed if financing is secured. If that happens, the construction of the mine would take about two years.
Hansen said the company still believes the Mt. Hope mine remains one of the world’s best and largest undeveloped moly projects.