Canadian miner Baja Mining Corp (TSX:BAJ) said on Monday it won’t be able to continue with its copper/cobalt/zinc project in Mexico beyond mid-June, unless it finds a way to fund cost overruns quickly.
In a statement, the company said it is exploring funding alternatives for the project and also that it is in discussion with its project partners and third parties.
Funds, said Baja, will not be available from its credit line until an acceptable funding solution is provided.
After a long-drawn-out battle over boardroom composition the company gave in to demands by dissident shareholder Mount Kellett Capital Management for new directors.
In a separate press release on Monday, Baja said it had appointed Tom Ogryzlo, Wolf Seidler, Stephen Lehner and Lorie Waisberg to its board of directors, which also includes Giles Baynham, Francois Marland and John Greenslade.
The company added its new board would also need to approve any new proposal.
“The company is concerned that an approval process in regards to the potential funding solutions being investigated may not be completed as quickly as required even if approved by the consortium,” Baja said in the statement.
To meet the shortfall the company has submitted a funding proposal to its Korean partners and it has also sent confidentiality agreements to third parties that might take part in the project. Additionally, Baja has talked to brokers about financing, but said “equity markets remain difficult.”
Baja’s shares keep plummeting and as of 12:00 ET today were down almost 14% to $0.35.