Ore Reserve Increase at Gabanintha Mine (October 24, 1988)

A reassessment of the ore reserves at the Gabanintha mine by Dominion Gold Mines of Australia has increased the reserves now drilled out in the current mining area to over 2.2 million tons at an in-situ grade of 0.11 oz gold per ton. According to Black Swan Gold Mines (VSE), which holds a 25% interest in the Australian gold project, this is sufficient to support the present rate of production for more than four years. The mine has a production rate of 40,000 oz per year at an operating cost of $230(US) per oz.

The company said exploration in the area to the south of the mine is continuing to indicate extensions to the open pittable ore. Combined with other discoveries and acquisitions in the Meekatharra region, these extensions are forecast by Dominion to be sufficient to allow operation of the mill for a further six years.

In accordance with a gold floor price program with an Australian bank, Black Swan has guaranteed a sales price of $440 per oz for 70% of its gold production until June, 1989. With a source of cash flow, and armed with the proceeds of a recent private placement that netted just over $1 million, Black Swan intends to acquire more gold projects in Australia and North America. It recently took on its first Canadian project, the Tas gold property near Fort St. James, B.C.