Davidson shareholders upset by mine delays

A production decision for the Tisdale gold project shared equally by Davidson Tisdale Mines and Getty Resources, is expected to be made by October, The Northern Miner was told after the annual meeting of Davidson Tisdale.

However, a majority of the shareholders was disappointed at the delays being encountered at the Timmins, Ont., area project. Ken Kent, president, and William Dingwall, chairman of the board, acknowledged their disappointment that a 1986 production decision was delayed. They argued that the delay has not been frivolous, but has enabled the partners to gain more information about the complex nature of the Tidsdale gold deposits.

“Operationally at Timmins, we did not spin our wheels last year,” Mr Kent said. “Much was done to give us a firmer foundation for that time when a production decision is made.” Mr Kent explained that although the structures hosting the mineralization are predictable, the actual nature of the distribution of gold within the zones is erratic — a common occurrence in the Timmins mining camp. As a result, additional underground work is required to improve confidence limits, before committing funds for placing the property into production, Mr Kent said.

The main zone decline has been extended to a depth of 600 ft and a second is being driven into the S-zone. Also, Getty engineers are completing a cost benefit analysis scheduled for completion sometime this month. Following the completion of the S-zone decline, the partners expect to be in a position by October to consider establishing a mine, Mr Kent said.

Despite the assurances, several American shareholders showed their displeasure with management by questioning the delays. They also demanded that the company improve investor relations.

Although the mine delays have dealt a blow to shareholder confidence, Davidson is financially healthy. At year-end, the company had cash resources of $5.9 million. Important equity investments include 100,000 shares of Getty which have a current market value of more than $1 million and 4.2 million shares of Vital Pacific Resources worth $7.2 million.