The future of mining at South Crofty could be under threat due to a rise in costs.

In a statement, one of the mine's investors, Canadian firm Celeste Mining Corp said it has decided to "review and evaluate cost cutting measures including but not limited to, temporarily halting its exploration and development activities at the South Crofty Mine".

It added: "The strategic review is a result of deteriorating equity markets, the financial position of the Company, operational complexities and higher than anticipated exploration and development expenses at the South Crofty Mine. Management continues to actively engage strategic partners in an effort to explore alternative funding strategies, which may include a brokered convertible financing.

"If the Company and its partners cannot agree on such cost cutting measures, the Company may elect not to contribute further expenditures which could result in dilution to its interest in the South Crofty Mine."

Celeste Mining Corp has also decided to "terminate" Alan Shoesmith as president and chief executive officer of the company.

Mr. Shoesmith will continue to serve as a director of the Company. Richard Kelertas has been appointed interim CEO.