Copper miner comes a cropper

GOLD Coast-bred copper miner CuDeco has finally collapsed following numerous production and financial problems, management changes and the suspension of its shares for more than a year.

The company, which has been based in Brisbane since 2016, was born out of former Gold Coast mining explorer Australian Mining Investments, which changed its name in 2006 to reflect its focus on copper projects. Cu is the code for copper on the periodic table.

At its launch shareholders hoped CuDeco would reach the heights of AMI, which floated in 1971 and saw its shares soar from 30c to $10 in the space of a few months in 2006. Investors piled in following speculation about the potential of its Rocklands project near Cloncurry.

The company was founded by colourful Gold Coast mining identify Wayne McCrae who once boasted that CuDeco would grow to become the world’s biggest copper miner.

However, success eluded CuDeco, which opened its Rocklands mine 10 years after its name change in 2016.

Yesterday, the company announced that key investor China Tonghai International Financial Limited had appointed three members of FTI Consulting as receivers and managers following a strategic review of funding and restructuring options. The failure followed a long period of decline for the company, which had suspended its Rocklands mine in north Queensland indefinitely as it struggled to restructure its finances.

All non-essential employees were stood down pending the restart of operations and the company’s shares remained in a trading halt.

Financial statements since the half-year to December 2017 remain to be finalised.

The receivers said they have secured funding from a group of lenders including CTIFL to complete a review of the Rocklands project.

“The receivers’ and lenders’ immediate priority is to explore all opportunities to maximise the value of the assets, either through the recapitalisation or restructure of the company with a view to financing the resumption of income generating activities at Rocklands or by a trade sale,’’ the company said.

Mr McCrae was turfed out of CuDeco in mid-2015 after CuDeco’s Chinese backers refused to provide a loan to keep the company afloat while Mr McCrae was at the helm.

In 2016 CuDeco completed a $63 million rights issue and returned to ASX trading after a lengthy suspension.

That year the company moved its head office from the Coast to Brisbane but was soon ordered to shut the Rocklands mine after failing a safety audit.