DIAMOND PAGE — Campbell reports loss

Mothballing of the Santa Gertrudis gold mine in Sonora state, Mexico, and lower production from its Joe Mann mine in Quebec have dealt Campbell Resources (CCH-T) a loss in the first quarter of 1999.

Campbell lost $3 million (or 2 cents per share) on revenue of $6.6 million over the three months ended March 31. By comparison, in the first quarter of 1998, the company posted a loss of $1.7 million on revenues of $10.3 million. Lower production from the Santa Gertrudis leach pads and from the Joe Mann underground mine, south of Chibougamau, Que., contributed to the poorer performance in 1999, as did a lower realized price for gold.

Production at Joe Mann fell to 15,300 oz. in the quarter, compared with 18,200 oz. during the corresponding quarter of 1998. The lower production was budgeted in this year’s mine plan, and reflected both mining in lower-grade areas of the mine and diversion of resources to exploration and development. Increased dilution in some stopes, experienced in March and April, did not affect results in the first quarter but has forced the company to revise its yearly production forecast to 75,000 oz. from 78,000 oz., and increase its cost forecast to US$260 per oz. — an increase of US$10.

At Santa Gertrudis, where final production from the leach pads ended in December, exploration continues on the company’s property and on the adjacent San Enrique property. Campbell is investigating several geochemical anomalies on the property.

Campbell also has come to an agreement with the bankruptcy trustee for Minera Roca Roja, a Mexican firm that produced gold on a property that adjoins Santa Gertrudis to the north. Campbell has completed 14 reverse-circulation drill holes on the property and outlined resources of 900,000 tonnes grading an average 1.5 grams gold per tonne.