Augmitto on schedule at Beauchastel property

Pre-production development is proceeding on schedule and within budget on Augmitto Explorations’ (TSE) Beauchastel gold property near Rouyn, Que.

The company reports that construction of a 1,000-ton-per-day concentrator and related infra- structure is currently under way, and will continue through the winter. Commencement of the mill is expected in April, 1989.

Augmitto recently appointed Roderick Pye, formerly of Coopers and Lybrand management consultants, to oversee operations at the company’s Beauchastel property. Pye had shared responsibility for operation of the Page-Willi ams deposit, and has had experience in South Africa, also.

Current reserves on the Beauchastel property (including a 15% dilution factor) stand at 202,348 tons proven and 1,279,467 tons probable grading 0.231 oz and 0.153 oz gold per ton, respectively. An additional 1,709,635 tons grading 0.166 oz gold per ton have been estimated in the possible and inferred categories.

Financing of the preproduction program at the Beauchastel property consisted in part of a gold loan negotiated with Rothschild Australia Ltd. The gold loan included forward sale arrangements which have hedged Augmitto against the current fall in gold prices. Under the forward sale arrangements, the majority of Augmitto’s projected 1989 production of bullion has been hedged with over 21,000 oz of gold being sold forward at an average price of $550(C) and a further 11,000 oz sold forward at $440(US).

The company is proceeding with public offerings in Quebec and Ontario, and it is anticipated that a final prospectus will be settled shortly.

Augmitto shares were traded recently on the Toronto Stock Exchange at 84 , just above its 12 month low point of 76 .