Sherritt assures continuity of operations in Cuba despite blackout.

The Canadian Sherritt International Corporation (TSX: S) announced on Monday that it will continue its operations in Cuba following the massive blackout that began on October 18, 2024, and continues to impact various sectors of the economy.

Despite the challenges posed by the power outage and adverse weather conditions resulting from Hurricane Oscar in the eastern part of the island, the company reaffirmed in a statement that it maintains its projections for 2024 in Cuba, where since 2023 it has been paying off a debt of $260 million with cobalt.

The Moa nickel mine and all the facilities of Energas S.A. returned to full operational capacity on October 27, the text explains.

According to the statement, after the blackout, the Moa mine initially operated at 50% to 60% of its capacity, utilizing energy generated on-site. The production of mixed sulfides did not experience a significant impact, it specified.

The Sherritt refinery in Alberta had strategically built up feedstock inventory earlier in the year, ensuring a reliable flow for finished nickel production.

As for Energas, operations partially resumed on October 19, although some temporary interruptions continued due to the complexity of the electrical grid.

Energas played a crucial role in restoring energy to the Cuban national grid, operating combined cycle plants that generate low-cost electricity from domestic natural gas.

During the national blackout, all environmental protection and safety activities at sites across Cuba continued without interruption, with no reports of environmental incidents or injuries among the staff, said the company, a global leader in hydrometallurgical processes for nickel and cobalt mining and refining, metals deemed critical for the energy transition.

The company has an estimated useful life of 25 years for its Joint Venture in Moa and has initiated an expansion program aimed at increasing the production of mixed sulfides by approximately 20%.

Through its participation in Energas S.A., Sherritt is the largest independent energy producer in Cuba, with an installed electricity generation capacity of 506 MW, accounting for approximately 10% of the national electricity capacity.

Despite these announcements, it is a reality that the national electroenergetic system (SEN) is wobbly, amid total and partial collapses that characterize recovery efforts in the eastern part of the island; while millions of Cubans have been enduring power outages of over 12 hours a day for months.

Since January 1, 2023, Cuba has been repaying a $260 million debt to the Canadian mining company with cobalt, through agreements known as "cobalt swaps" that extend over five years.