Third-quarter output drops for Hemlo Gold

A lower gold output and higher operating cost were reported by Hemlo Gold Mines (TSE) for the third quarter of 1988 compared with the same period last year.

Hemlo Gold, controlled by Noranda Inc. (TSE), also reported lower earnings for the quarter, $7.5 million (8 per share) on revenue of $47.5 million, compared with $20.5 million (23 per share) on revenue of $68.6 million last year.

During the quarter, the company produced 85,250 oz gold from its Golden Giant mine at the Hemlo camp in northern Ontario at an operating cost of $109(US) per oz. During the same quarter in 1987, the company turned out 115,181 oz at $79 per oz. Head grade was down, to 0.31 oz gold per ton from 0.48 oz during the third quarter, 1987. The recovery rate during the quarter, at 94.5%, was also down, while the tonnage milled increased.

For the first three quarters of the year, Hemlo Gold recorded net earnings of $32.6 million (37 per share) on revenue of $143.5 million, compared with $34.9 million (40 per share) on revenue of $139 million for the eight months (Feb 2-Sept 30) the company was in operation in 1987.

To the end of September this year, Hemlo Gold produced 246,733 oz gold at an operating cost of $114 per oz.

In other news, the company’s board of directors has approved spending $3.5 million on its share of the prefeasibility study on the Eagle River gold property in the Mishibishu area of northern Ontario; its partner in the project is Central Crude (VSE).

Also, Hemlo Gold plans to spend $11 million on its share of the 1989 exploration program at the Tundra gold project at Courageous Lake in the Northwest Territories. Its partner there is Total Energold (TSE).