Equity Silver looks for new reserves

Anthony Petrina, president, told shareholders at the company’s recent annual meeting that ore reserves at its present open pit mine are sufficient to sustain mining only until 1992.

The Placer Dome (TSE) subsidiary had carried out an aggressive exploration campaign for reserves in the immediate area with limited success. Since 1986, however, the regional exploration effort has been expanded nation-wide.

After looking at prospects across North America, the company acquired an option to earn a 50% interest in the Nugget Pond prospect near Baie Verte, Nfld., from Bitech Corporation (ASE).

“Our people believe there is very good potential here,” said Petrina, noting the work to date has established 555,000 tons averaging 0.35 oz gold per ton to a depth of 500 ft.

With the deposits still open at depth, two diamond drills are working to outline the full extent of the zone. Petrina said additional targets “with geophysical similarities” have already been identified, with a third rig added to search for other deposits within the claim block.

In his discussions on the company’s current mining operation in British Columbia, Petrina noted that earnings for common shareholders were $9.94 million or 31 cents a share in 1988, compared to a loss of $14.98 million in 1987.

Despite a 48 cents (US) decline in the average price of silver over the past year, increased sales of silver, gold and copper reflect higher grades and improved recoveries in the mill.

The plant and open pit mine produced 5.8 million oz of silver in 1988, along with 48,300 oz of gold and 14.9 million lb of copper.

Petrina noted that the scavenger circuit more than doubled the amount of gold reclaimed from mine tailings in the previous year, adding 16,500 oz to the mine’s total production.

Better smelter terms, lower depreciation charges and forward sales of precious metals all made further contributions to the earnings improvement.

This improvement for common shareholders occurred after a provision of $3.7 million to cover post- closure costs and $4.59 million for the national exploration program.

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