Auspicious start for Highland

The first full financial year for London-listed Highland Gold (HGM-L) ended profitably, with the gold-producer posting a US$18-million profit on revenue of US$71.5 million.

Highland, which operates the Mnogovershinnoe (MNV) gold mine in the Russian Far East, produced 194,000 oz. gold in 2003 at an average cash cost of US$159 per oz. MNV produced 178,000 oz. in 2002.

Financial results were stated only for the last six months of 2002, the company having gone public in May of that year. In the six months ended Dec. 31, 2002, Highland earned US$5.3 million on revenue of US$27.4 million.

The company has nearly finished construction at its second mine, Darasun, about 200 km east of Chita in Siberia. Production at the annual rate of 40,000 oz. is scheduled to start in May. At Novoshirokinskoye, near the Chinese border, about 450 km east of Chita, a final feasibility study is expected by year-end.

Barrick Gold (ABX-T) holds 17% of Highland, having taken a share issue for US$40 million in the junior producer last January and acquired some of the shares that Harmony Gold Mining (HMY-N), which had held a 31.7% interest in Highland, sold in October 2003.