Exploration in high gear for Imperial Metals Corp.y.

Exploration has moved into high gear, says Imperial Metals Corp. Cha irman Hugh C. Morris in a first quarter report to shareholders.

Drilling is scheduled for the Cunningham Creek and Takla projects in central B.C where past drilling has demonstrated gold mineralization grading 0.4 to 0.6 across mineable widths, he points out.

At the Nevada Hog Ranch project, in which Imperial holds a 30% interest, joint venture partner Western Goldfields has completed site preparations and ore is being placed on the leach pads at the full operating rate. Mr. Morris says gold production and sales should be obtained in October. The Imperial Group, he adds, is carried for 100% of all costs in this venture and will receive 15% of net revenues until capital expenditures are recovered.

Regarding Colony Pacific Exploration’s`s Blue Moon project in California, Mr. Morris says aggressive exploration is warranted. Imperial assumed management control of Colony effective April 18. Mr. Morris points to drill hole #33 which returned 34 ft grading 25% zinc and 0.152 oz gold per ton and drill hole #40 which returned 42 ft grading 0.21 oz gold per ton as demonstrating the ore-making potential of the property.

On the uranium front, the Imperial Group purchased a 50% interest in the Crow Butte, Neb., uranium project bringing the group’s position to 100%. With established reserves of 44 million lb of uranium at a grade of 0.3%, the project is under the operatorship of associate Ferret Exploration of Denver.

Mr Morris says that in July an agreement in principle was reached with a major corporation for the sale of part of Imperial’s 100% interest in the Crow Butte. Final negotiations are in progress and the transaction should close in the second quarter.

Imperial posted a net loss of $127,000 in the first quarter endedJune 30 compared to a net income of $464,000 before an extraordinary item in the comparable period of 1985.

Cash at the end of the latest 3 month period stood at $3.13 million compared to $4.14 million at the end of the year-earlier period.