Breakwater back from the brink

With progress being made to address the metallurgical difficulties at the Caribou zinc-lead-silver mine, Breakwater Resources (TSE) is well on the road to recovery, company officials say.

“Your company has emerged from being in a precarious financial position to a position where we could, within 12 months, become a significant, low-cost, intermediate mining company with a bright future,” President Gordon Bub told shareholders at the annual meeting.

Shareholders welcomed the news that metallurgical tests on a 200-tonne bulk sample from the Caribou mine, situated near Bathurst, N.B., showed the zinc concentrate to contain 52.5% zinc, and the zinc to be 83% recoverable. The 50.1% lead concentrate was shown to be 70.3% recoverable, and the recovery of silver was 64.7%.

When the mine was in production for seven months in 1990, recoveries of zinc, lead and silver were 73%, 34% and 28%, respectively.

While full results of the feasibility study are not expected until July, Bub expects the mine to re-open in early 1996. “All indications to date are positive,” he said. “It should be a very profitable mine, given decent metal prices. The mine will make money at today’s prices.”

Bub said Breakwater’s overall metal production could increase as much as fivefold over the next two to three years.

“There are, to my knowledge, few mining companies with that kind of growth potential from existing orebodies with existing infrastructure.” Breakwater shareholders approved a 400-to-1 consolidation of its common shares and then, in turn, a 20-to-1 split. The net result was a 20-to-1 share consolidation.

Meanwhile, shareholders voted to add Colin Benner, Breakwater’s executive vice-president and chief operating officer, to the board of directors. Benner joined Breakwater in 1994.