Miramar hits production targets (July 22, 2002)

Vancouver — Despite feeling the impact of the temporary suspension of the Con autoclave, Miramar Mining (MAE-T) expects to exceed its 2002 production forecasts from its operations at Yellowknife, N.W.T.

The second quarter of 2002 saw Miramar produce 25,791 oz. gold at a cash cost of US$197 per oz from the Con and Giant mines. This compares to the 36,760 oz. of gold at a cash cost of US$255 per oz tallied in the second quarter of 2001.

Driving the production short fall was the suspension of the Con Autoclave. In Mid March, the roof of the building containing the plant that produces oxygen to operate the autoclave collapsed forcing the suspension.

In the meantime, free-milling operations continued with 14,015 oz. of refractory gold-bearing concentrates stockpiled during the quarter as the autoclave resumed operation on June 24.

The Con mine contributed 65,994 tonnes grading 14.61 grams gold per tonne in the three-month period ended June 30. Giant added 16,027 tonnes at 14.3 grams gold. Ore from both mines was processed at the Con mill.

“During the second quarter, Yellowknife operations performed exceptionally well driven by higher than expected grades at both the Con and Giant mines and lower operating costs,” says company President Tony Walsh. “Overall, we are well on track to surpassing our 2002 production forecast.”

The company yearly production forecast stands at 130,000 oz. gold with cash costs coming in under US$240 per oz.

In mid-July, the company inked a new three-year collective agreement with its mill employees. Under the deal, workers will see annual pay rises of 7%, 5%, and 3%.

With the labour issue solved and the increase in the price of gold over the past year, Miramar plans on extending the operating life of its Yellowknife operations through to the end of 2004.

The extended mine plan calls for the gradual conversion to a fully refractory operation as free milling reserves become depleted at Con.

In 2003 and 2004, Miramar expects production to fall to 90,000 oz with cash costs rising to US$255-$260 per oz.

Looking for growth, Miramar has its sights on advancing the Hope Bay project in Nunavut. In June, the company completed its merger with Hope Bay Gold, consolidated the companies’ 50-50 ownership of the project, 865 km north of Yellowknife and 170 km southwest of Cambridge Bay.

Shareholders of Hope Bay Gold overwhelmingly approved the amalgamation and received 0.263 of a Miramar share in exchange for each share held. Miramar issued 39.5 million shares to Hope Bay Gold shareholders and now sits with 105.6 million shares outstanding.

Cashed up after a $30-million financing, Miramar is currently in the midst of an aggressive drill campaign aimed at advancing the Doris deposit to production as well as testing a number of new targets.

The Hope Bay property-wide mineral resource currently hits 4.3 million in situ ounces and is spread roughly evenly between the Boston, Doris and Madrid deposits.

Measured and indicated resources total 3.4 million tonnes grading 15.4 grams gold per tonne, equivalent to 1.7 million oz. An additional 2.6 million oz. of inferred resources are contained in 6.7 million tonnes grading 12.3 grams.