Sierra Rutile provides operational, development, ESG and corporate update for Q1 2024

Sierra Rutile Holdings Limited (ASX: $SRX) presents its operational, development, ESG, and corporate update for the quarter ended 31 March 2024. The company reported a net cash production cost decrease of 18% despite the suspension of Area 1 operations. The Managing Director and CEO, Theuns de Bruyn, commented on the unsolicited takeover offer by PRM Services LLC, recommending shareholders to reject the offer. The Board also announced the upcoming AGM on 16 May 2024 and provided an update on the Area 1 operations suspension.

Sierra Rutile Managing Director and CEO, Theuns de Bruyn, comments on Q1 2024

The March quarter was an extremely eventful and challenging period for Sierra Rutile due to several factors. The unsolicited takeover offer from PRM Services LLC was deemed inadequate and failed to capture the full potential of Sierra Rutile, particularly the positive impact of Sembehun. The Board continues to recommend shareholders reject the offer. The reduction in the estimated capital expenditure needed to bring the Sembehun project online was a positive outcome in these inflationary times. The projected 14-year mine life of Sembehun reinforces its long-term nature and potential to deliver sustained economic benefits to Sierra Rutile and local stakeholders in Sierra Leone. The suspension of operations at Area 1 following the Government of Sierra Leone's position on the fiscal regime was disappointing, and the company is engaging with the government to seek a resolution.

Sierra Rutile Q1 2024 update and outlook

Sierra Rutile (ASX: $SRX) reported a challenging quarter with the unsolicited takeover offer from PRM Services LLC, which the Board recommends rejecting. The company's focus remains on the Sembehun project, which has the potential to fundamentally change the cost base and economics of Sierra Rutile's mineral sands business. The reduction in estimated capital expenditure for Sembehun and the approval of the Environmental, Social and Health Impact Assessment (ESHIA) license are positive developments. Sierra Rutile's net cash at the end of the quarter was $4.7m, and the company is seeking opportunities to sell slow and non-moving consumables inventories. The company is also exploring various options for Area 1, including the potential for a re-start through to a closure case. Discussions with respect to Sembehun will occur with major development partners and key industry participants, and the company remains committed to sustainable operations and upholding high standards for environmental, social, and governance practices.