SET-listed Akara Resources Plc plans to rev up gold digging activity in its Chatree mine in Phichit province, where the government has ordered it to cease mining by year-end.
The company said it would also continue to fight against the government order, with the chief executive of parent Kingsgate, a Sydney-based firm, coming to meet the Thai authorities next week. Chief executive Greg Foulis seeks to convince them the company's mining processes did not cause any adverse health impacts to local villagers in an appeal to continue business in Thailand.
"Mr Foulis is very concerned about the case since we are confident we have never broken any laws or regulations. We need a clear explanation from the government about why we have to stop our business," said Akara chief financial officer Siroj Prasertphon.
Foulis: Concerned, ready for a discussion
Chat Hongtiamchant, director-general of the Industry Ministry's Department of Primary Industries and Mines, confirmed Mr Foulis is coming for a discussion.
After receiving complaints from villagers and non-governmental organisations near the mine that their health was adversely affected by the mining, in May the cabinet ordered Akara to stop all mining activities. It was granted licences to operate a gold mining business in Phichit until 2028.
Akara estimates ceasing its mining business there would mean losses of 39 billion baht.
The suspension has also raised the concern of its creditor as Akara put up its mining buildings, land and other assets as collateral for a loan.
The company wants to increase gold digging now, adjusting its production plan to quickly acquire more gold to pay debts and its 1,000 employees, said Mr Chat.
"Akara is also concerned about its finances and how it can repay debt. This will be a part of the discussion between Mr Foulis and the Thai government next week as the company said it is open to government suggestions on how it can repay its debt after the halt," he said.
Mr Siroj said Akara needs to send a new operation plan for Chatree to the creditor, CIMB Thai Bank, the local unit of Kuala Lumpur-based CIMB Group.
The company borrowed 3.8 billion baht for capital investment and already paid back some creditors. Akara has 2.2 billion of debt coming due in three years.