Watch it grow again: profit for Battle Mountain

Improving gold prices and lower unit production costs are the prime reasons for the 50% increase in profit posted by U.S.-based Battle Mountain Gold in its first quarter.

A profit of $8.8 million or 20 cents per share was realized in the 3- month period ending March 31, up 50% from the $5.8 million or 14 cents per share earned during the first quarter of 1986.

Revenues for this year’s first period were $24.5 million, up 16% from the $21.1 million earned in the same quarter a year earlier.

The strong first quarter earnings translate to a net income per equivalent ounce of gold sold of about $142, with an average realized gold price of $401. That’s up about 50% from the $94 per equivalent ounce earned in the first quarter of 1986, with gold priced at $339.

Cash costs at the company’s Fortitude mine/mill complex, near Battle Mountain, Nev., continue to decline, averaging $140 per equivalent ounce of gold in this year’s first quarter compared with $160 per equivalent ounce in the same period last year.

Total costs also declined to $165 per equivalent ounce for the quarter, compared with $187 a year earlier. Additional cost improvements are expected at the Fortitude this year as the stripping ratio is lowered to about 5:1 through a programmed decline.

At the nearby Surprise mine, equipment and personnel are now phased over to begin waste stripping. Some of the higher grade ore — 0.12 oz gold per ton — is expected to be available before year-end and will be hauled to the Fortitude mill for blending with Fortitude ore.

Metallurgical testing is continuing in order to develop the most economic heap leaching system for the lower grade ore.

In Australia, construction is under way on the new Pajingo gold mine with the first gold pour expected this November. Full production of 60,000 oz per year is expected for 1988.