Aurizon Mines (AZK-AMEX, ARZ-TSX), according to La Presse, a Quebec Newspaper, the dam of a tailings pond has been breached, spilling 150 million gallons of toxic materials at their Casa Berardie project. According to the paper, the Emergency Department of the Ministry of the Environment of Quebec was notified, and has classified the environmental emergency at a level 2 of 3. Both solid and liquid waste were spilled onto land, and it's uncertain if toxic materials have reached a creek a mile away.
The stock opened little changed on the TSX (where most volume is traded) at CAD$4.27, then sold off sharply on heavy volume starting just after 10AM to a low of $3.73. The shares recovered slightly up until trading was halted by IIROC at 10:49am.
Aurizon has received a friendly bid from Hecla mining to be acquired in a cash and stock deal. Given the unknown impact of the spill, it's unclear whether it could effect the takeover, which is set to be voted on May 7th. Given the large number of hedge funds that usually participate in merger-arb deals, it's likely they would have had stops in place to sell ARZ to mitigate losses, further adding to the sharp slide in price.
La Presse Link:
Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in AZK over the next 72 hours.