UPDATE: Richmont Mines Down 25%, Earlier Fell To 52-Week Low; Closes Quebec Gold Mine

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Shares of Richmont Mines ( RIC ) are down 24.6% at $2.88 after earlier setting a new 52-week low of $2.78 after the company announced the immediate closure of Francoeur Mine and the suspension of exploration activities on the Wasamac gold property. Both assets are located near Rouyn-Noranda, Quebec, Canada.

RIC will take a pre-tax write-off of approximately CAD 11 mln - CAD 13 mln, or

about $11.08 mln - $13.09 mln, related to the closure of the Francoeur Mine,

the majority of which will be accounted for in Q4 2012. The write-off will

consist of $4 mln - $5 mln in cash, related to employee severance, with the

remaining amount being non-cash.

The company said that it could not find a solution to "make the the project

economically feasible at present or over the long-term."

Commercial gold production at Francoeur will cease on Nov. 30, 2012, and the

closure process will take about 4 months to be completed. About 115 employees

will be laid off immediately and 35 employees will be retained temporarily for

this 4 month de-commissioning period.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Commodities

Referenced Stocks: RIC

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