Audrey tonnage on Mobrun 1100 lens increases by 75%

The mine, which produces copper, zinc, gold and silver from a shallow orebody, is 30 km north of Rouyn-Noranda in northwestern Quebec.

Based on a recently completed underground drilling program, mineable reserves (in the probable category) of the 1100 lens have been upgraded to 10.4 million tonnes grading 0.76% copper, 5.43% zinc, 37.4 g silver per tonne, and 1.35 g gold. That represents a 75% increase over an earlier reserve figure of six million tonnes reported last February.

Hailed as one of the most significant polymetallic discoveries in Quebec, the 1100 lens is expected to be in production by 1992 at a development cost of about $50-60 million.

Using current metal prices, Audrey estimates the 1100 lens has a total recoverable value of $700 million assuming a cutoff net smelter return of $31 per tonne.

“It’s a big advantage to have a shaft and mill already at the site,” said President Guy Hebert who was pleased with the recent results.

“It would be easy to do a big promotion on the strength of the 1100 lens, but Audrey isn’t inclined to that,” he said.

He said several major mining companies have been keeping a close eye on Audrey’s expanding reserves in the 1100 lens. He agreed the company could be a potential takeover target.

“If a senior mining company comes along with an attractive takeover offer at $7-8 per share, we would probably have to look seriously at it,” said Hebert.

Total reserves in all categories for the 1100 lens have been upgraded to 15.5 million tonnes grading 0.83% copper, 4.64% zinc, 35.9 g silver, and 1.26 g gold.

To date, the company has delineated the upper and lateral limits of the 1100 lens, which remains open at depth.

Additional drilling is scheduled to resume in January from the mine’s underground workings, and a $750,000 surface exploration program will test other targets on the property.

The reserve upgrade for the 1100 massive sulphide lens was announced this week, following a final compilation of results from a major underground drilling program completed this fall.

Discovered nearly a year ago by geophysics, the 1100 lens is the biggest of five massive sulphide lenses on the property. It lies about 240 metres southeast of the main orebody where mining is under way and is buried at vertical depths greater than 300 m below surface.

The new orebody is being developed in a 50/50 joint venture with partner Minnova Inc. (TSE). At presstime the shares of Audrey Resources were trading at $3.50. Toronto-based Northgate Exploration (TSE) owns a 18% stake in Audrey, but is rumored to be interested in selling its stake.

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