Sherritt Flags Risks as Cuba Sanctions Halt Operations
Sherritt International’s going-concern warning, triggered by Trump’s May 2026 executive order expanding secondary sanctions to foreign operators in Cuba, exposes how US geopolitical policy can rapidly destabilize critical mineral supply chains across North America. The shutdown of Sherritt’s Fort Saskatchewan refinery eliminates a key processing node for EV battery inputs at a moment of rising industrial demand.
Sherritt International Corp. warned investors its survival as a concern is in doubt after Trump’s expanded US sanctions on Cuba triggered default provisions in its C$79.5 million (US$56 million) credit facility. The miner said its ability to meet or refinance its debt “remains uncertain” and that it lacks sufficient cash to repay lenders if they exercise early repayment rights. Bondholders may hold the same right.
The warning came alongside interim financial results published June 26, capping months of operational and financial deterioration at one of Cuba’s largest foreign investors.
Three Decades in Cuba, Now at Risk
Founded in 1927, Sherritt has operated in Cuba since the early 1990s, forming the Moa joint venture with Cuba’s General Nickel Company in 1994. The company holds a 50% stake in Moa Nickel in Holguín province, a one-third interest in Cuban power producer Energas, and stakes in oil drilling on the island. During the commodity boom of the late 2000s, its market value approached CA$5 billion, a figure that contrasts with its current CA$134 million valuation.
The company’s Cuba ties have long put it in conflict with Washington. Under the Helms-Burton Act in the 1990s, former CEO Ian Delaney and other executives were barred from entering the United States. That tension has now reached a breaking point.
The current crisis began in February, when Venezuela halted oil shipments to Cuba following US pressure after the capture of President Nicolás Maduro. Trump then signed an executive order imposing tariffs on any country supplying oil to Cuba, severing the island from its main fuel source and leaving Moa unable to sustain operations. Cuba faced blackouts of up to 18 hours daily. Sherritt suspended some Cuban operations that month.
On May 1, Trump expanded secondary sanctions to foreign companies operating in Cuba’s mining, energy and financial sectors. Sherritt suspended its joint venture participation on May 7. Shares fell as much as 30% in Toronto. The company delayed its 1Q26 results. Its CFO and auditor resigned. Three board members, Brian Imrie, Richard Moat and Brett Richards, also stepped down.
After initially moving to dissolve its Cuban joint venture, Sherritt reversed course and entered exclusive talks with Gillon Capital LLC, a Texas-based family office linked to a former Trump administration adviser. A preliminary non-binding deal would give Gillon a warrant to acquire a 55% controlling stake through a private placement.
By June 22, feedstock inventories from Moa had run out, forcing the shutdown of Sherritt’s Fort Saskatchewan refinery in Alberta. The refinery is one of only three nickel-processing facilities in North America and the continent’s only dedicated cobalt refinery, with an annual combined production capacity of approximately 38,200t. It will remain idle until Moa resumes and the feed pipeline is rebuilt. The site continues producing fertilizers and sulphuric acid.
The company said it “has and will undertake numerous initiatives available to it to continue to strengthen its financial position and enhance liquidity,” citing cost and workforce reductions, capital spending cuts, payment deferrals and a recent equity injection. The production halt and expanded sanctions, Sherritt said, “result in material uncertainty which may cast significant doubt about the Corporation’s ability to continue as a going concern.”
Critical Minerals at Stake
The Fort Saskatchewan closure removes North America’s only dedicated cobalt refinery from service at a moment when cobalt demand for EV batteries is rising and China accounts for more than 70% of global refined cobalt output. Cuba’s nickel and cobalt resources have drawn increasing attention from governments and investors focused on critical mineral supply chain security, attention that now has no near-term outlet through Sherritt.
The escalation against Cuba follows the Trump administration’s broader use of tariffs, sanctions and diplomatic pressure across Latin America to limit the influence of governments it considers adversarial. The simultaneous sanctioning of Gaesa, Cuba’s military-linked conglomerate, signals the pressure campaign extends well beyond the mining sector.
For Mexico, the episode carries direct relevance. The Mexico-US Action Plan on Critical Minerals, announced Feb. 4, 2026, frames North American supply chain integration as a strategic priority. The Sherritt collapse illustrates how secondary sanctions can sever feedstock pipelines, trigger debt covenants and idle processing capacity with little warning, a geopolitical variable that sits alongside Mexico’s own regulatory constraints as it seeks to position itself as a reliable supplier within that framework.