Harvest Gold Silica, a company that borrowed $22 million in the municipal bond market to build a plant that produced fertilizer from mine waste, filed bankruptcy on March 4, according to Bloomberg, citing a court filing. Harvest Gold listed assets of $1-$10 million and liabilities of $10-$50 million in a Chapter 11 filing in the US Bankruptcy Court of the Northern District of Texas.
The Arizona Industrial Development Authority issued the unrated bonds on behalf of Harvest Gold in 2019. Harvest Gold processed waste from a mine in Congress, Ariz., which produced gold from 1890-1911 and was reopened for a short time in the 1990s. The project was expected to excavate and process about 10,000 tons of mine tailings into silica for use as a soil additive, according to an offering document.
However, the operator of the plant, Vast Mountain Development Inc., had only produced silica sand from mine tailings “for a short time and only on a pilot project basis,” the offering document said. The bonds were sold to Greenwich Investment Management, according to litigation related to the bond sale. Vast Mountain also filed for bankruptcy, listing assets and liabilities of $1-$10 million.
Harvest Gold’s bankruptcy is the second this year for a project financed through the Arizona Industrial Development Authority. In January, an Arizona lumber company that borrowed almost $200 million through the agency filed Chapter 11.