(Sharecast News) - Shares in North American metallurgical coal miner Bens Creek were sliding on Friday afternoon, after the company issued an update on its operations and working capital position, confirming that its West Virginia mine was moving into care and maintenance.
The AIM-traded firm said that in response to the current state of the metallurgical coal market, financial constraints within the company, and operational challenges at its mine, its board had made a number of key decisions on 9 and 10 April.
As a result, Bens Creek Operations WV (BC Operations), a wholly-owned subsidiary, had significantly reduced operations.
That decision led to the lay-off of 44 employees, a substantial portion of the mine's workforce in West Virginia.
Additionally, from 11 April, the mine would operate on a care and maintenance basis for the foreseeable future.
Avani Resources, the company's largest shareholder, primary off-take partner and lender, was currently engaged in discussions with Bens Creek regarding the terms of providing additional financial support.
The company said a term sheet outlining the terms was under review by the company's legal counsel.
Any potential agreement with Avani could constitute a related party transaction under the AIM rules, the board noted.
"The company continues to assess all options available to it and will make further announcements at the appropriate time," the board said in its statement.
At 1359 BST, shares in Bens Creek Group were down 23.53% at 0.65p.
Reporting by Josh White for Sharecast.com.
Bens Creek (BEN)