Fuel supply resumes for Centamin, but mining still suspended

Centamin has reassured investors that fuel supply to its Sukari mine in Egypt has resumed, after the Egyptian General Petroleum Corporation (EGPC) went back on its decision to hit the gold miner with a retrospective payment claim.

Centamin's shares lost nearly 50% of their value on Thursday after saying it had suspended operations at its flagship, Sukari.

The company said that it had received an "illegal" $65m retrospective claim from EGPC which then refused to supply more fuel to Sukari until the money was paid.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

In addition, the firm also announced that its process of gold exports has been hit by delays due to "an unforeseen and arbitrary request from customs officials" for the prior approval from authorities.

Centamin said that the EGPC has now decided that no payment is now needed. However, operations at Sukari have not restarted with the miner saying that it will give a further update on the status of gold exports "in due course".

In other news, Centamin said: "The escalation in diesel pricing that the company experienced from local to international in January 2012 is currently before the courts and has been for some months. This case will also deal with any retrospective claim."