Audrey warms up Mobrun mill while cutting debt by $10 m

As the new 1,100-ton-per-day facility, built at a cost of $21 million, is brought to full speed, Vice- president Michel Bouchard of Audrey claims to be pleased with its performance.

“We have some adjustments to make and some screws to tighten but we are happy with the way it is going,” said Bouchard who expects the operation to be running at full capacity by Oct 1.

If he is correct, Audrey will churn out about 120,000 tonnes of massive sulphide ore grading 0.78% copper, 2.45% zinc, 2.6 g gold and 32 g silver by year end at a cost of $32.28.

Bouchard is also happy with a recent public issue of 5.5 million units, priced at $4 each, which raised $22 million for debt reduction and working capital purposes.

Units consisting of one common share and a half warrant were placed entirely within Canada, according to Bouchard. Subscribers included Minnova, which recently agreed to spend $10 million on a Mobrun expansion program in return for a 50% stake in production from the new 1,100 massive sulphide lens.

Roughly estimated to contain about 15 million tons of massive sulphide, the lens is still being explored and will eventually replace four other lenses when they are mined out in 1992.

Having agreed to take down 1.25 million units, Minnova currently has about 8% of Audrey’s 14.9 million shares outstanding. Audrey’s other major shareholder Northgate Exploration (TSE) of Toronto didn’t participate in the issue and as a result its stake in Audrey has fallen from about 28% to 20%.

According to Bouchard, Audrey is planning to reduce its $20.7 million long-term debt load by about $10 million using proceeds from the public issue.

Once the mill is running at full capacity, the emphasis at Mobrun will shift towards development of the 1,100 lens, some 240 m southeast of the mine workings.

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