GBN: Hecla Is Requesting a Further Delay
I talked with Hunter Dickinson this morning, to obtain this information:
By the original contract Hecla was to have finish the decline at Hollister by the first part of May. An agreement was then reached, between Hunter Dickinson and Hecla, to extend this date to the end of August. As I remember that new agreement, Hecla had argued that they would be using newer equipment then originally planned, and this equipment would operate at a faster rate, and therefore be more efficient then the previously planned older equipment.
The president of Hecla has recently informed Hunter Dickinson that they want an extension of 15 months, from the first part of May, to build the decline. By current contract they are obligated to complete the decline by the end of August or lose all of their interest in the project. They would not be compensated for the monies they have spent nor receive any profits from GBN. Hecla is currently planning to have a third party look over the contract to see if there is a better way out for them.
Hunter Dickinson’s firm position is that if they grant them a contract extension, they want fair compensation, in return, for the shareholders. Hunter Dickinson has assured me that the current contract is very clear on what Hecla’s obligations are and what happens if they do not meet their deadlines.
I want to point out that delays in the mining industry are a quite common occurrence. So if you hold mining stocks you should be prepared for occurrences such as these.
