The Syrah Resources Ltd (ASX: SYR) share price is deep in the red today amid the company advising of what it calls “illegal industrial action” at its graphite operation in Mozambique.
Shares in the graphite miner and battery anode developer are currently trading for $1.517 each, a 20.58% drop on Friday’s closing price.
Let’s take a closer look at what the company announced today.
Work halts at Balama site
The update said the company had to stop work at its Balama graphite operation and move its remaining personnel from the site last Tuesday. This was due to actions by “a small contingent of local employees and contractors” causing safety concerns, the update reported.
Syrah notes “the actions taken by this group are not deemed representative of the majority of the Balama workforce”.
Negotiations are reportedly underway between the aggrieved personnel, the site’s internal union committee, and Mozambique government representatives to resolve the issue.
Once the safety of its personnel can be secured, employees and contractors will return to the site with operations restored “as soon as possible”, according to the update.
The company also gave a short operational update. It said 38 kilotonnes of graphite had been produced in the current quarter and sales stood at 54 kilotonnes.
Syrah Resources shares were halted on September 21 to give the company time to post today’s announcement to the market.
My Fool colleague James notes it is not the first time Syrah’s operations have come to an unplanned halt. Previous stoppages include attacks by insurgents at the company’s mine site near Ancuabe, a fair distance from the Balama project.
Syrah Resources share price snapshot
The Syrah Resources share price is down 21.66% year to date. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is 14.5% lower over the same period.
The company’s current market capitalisation is $1.02 billion.
The post Syrah Resources share price sinks 21% amid ‘illegal action’ appeared first on The Motley Fool Australia.
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Motley Fool contributor Matthew Farley has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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