- Perenti shares tumble 7% following instability in Burkina Faso
- Management advises all employees are safe and accounted for
- The company operates three gold projects within the country
The Perenti Global Ltd (ASX: PRN) share price is in the red today following the release of a breaking update.
At the time of writing, the diversified mining company’s shares are travelling 7.10% lower to 78.5 cents.
Perenti provides security update
In a statement to the ASX, Perenti advised that its operations in Burkina Faso are continuing as usual despite the political turmoil.
The West African nation’s military recently seized power and deposed President Roch Kabore over his failure to stop Islamist insurgency. The coup comes after the security situation deteriorated rapidly over the last few months.
Perenti noted that all employees are safe and accounted for, and is working closely with its clients and advisors.
Investors will be closely watching how the security situation unfolds as this will weigh on the Perenti share price.
The company runs the Sanbrado Gold Project, which is about 90 kilometres east-southeast of the capital, Ouagadougou, Burkina Faso. The site is considered as one of the highest margin gold projects in West Africa.
In its first year of production, Sanbrado is expected to produce more than 300,000 ounces of gold. The following four years is anticipated to yield an average of 217,000 ounces annually, and 153,000 ounces each year thereafter.
The mine has a current lifespan of approximately 10 years.
There are a couple of other projects that the company operates within the country, however, they are in other provinces. They include Siou, another high-grade gold deposit, and Yaramoko, a high-grade underground gold operation in Moko.
About the Perenti share price
Established in 1987, Perenti is one of the world’s largest companies that provides surface and underground mining and support services. The group is headquartered in Australia and has operations and offices across 11 countries.
Over the past 12 months, the Perenti share price has dropped over 40%, with year-to-date performance also down around 13%.
The company’s shares reached a 52-week high of $1.55 last February before the release of its half-year results. Since then, Perenti shares plummeted following a disappointing trading update in May and a poor financial scorecard in August.
On valuation grounds, Perenti commands a market capitalisation of roughly $568.09 million, with about 705.71 million shares on issue.