Nasdaq halts trading as Alta files for bankruptcy

With trading of its shares halted, Alta Gold (ALTA-Q) has filed for bankruptcy protection.

The Nevada-based gold producer hopes to restructure US$29 million in outstanding debt as well as US$4 million in accounts payable.

Nasdaq ordered the cease-trade on April 15, when the issue was hovering around US50 cents per share.

Alta’s problems stem from clogged drip lines at the new Olinghouse gold mine, 30 miles east of Reno, Nev. The malfunction resulted in poor recovery from the heap-leach operation, driving cash costs above US$430 per oz.

The company recognized and fixed the problem in March, though not soon enough to pay off its debt load.

“Daily operations will continue,” says Alta President Robert Pratt. Olinghouse is producing 2,000 oz. per week, though the company expects it to reach full capacity of 2,500 oz. per week by the end of June.

Alta hopes to crank out 70,000 oz. for 1999, at an average cash cost of US$200 per oz.

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