Bema’s Refugio winds down

With leaching operations at the 50%-owned Refugio mine in Chile gearing down, Bema Gold (BGO-T) has posted a second-quarter loss of US$2.2 million (or 1 per share).

The loss compares to a year-ago net loss of US$4.7 million (3 per share).

Revenue between the two periods slipped US$800,000 to US$7.1 million. Cash consumed by operations was US$426,000, compared with the US$502,000 generated a year earlier.

For the first half of the year, the net loss tallied US$5.1 million (3 per share) on US$14.9 million, compared with a net loss of US$8.2 million (6 per share) on US$16.6 million. Cash from operations was US$1.4 million — double the level attained in the corresponding period of 2000.

Bema’s share of first-half production totalled 48,486 oz. produced at US$233 per oz., compared with the year-ago 47,531 oz. produced at US$269 per oz. The recent quarter’s production was slightly better than the planned 48,250 oz. at US$237 per oz.

Thanks to its hedging program, Bema realized an average price of US$311 per oz. for its production, a US$44 premium over the quarter’s average spot price.

Refugio has been running in residual leach mode since mining activities were placed on care and maintenance on June 1, due to persistently low gold prices. During the second quarter, about US$1.7 million (Bema’s share was US$841,000) were charged to operations as a result of the cessation of mining. Gold production from the heap-leach pads will continue for the rest of 2001. Bema expects that its share of production and cash costs at the mine will remain on budget.

At the 79%-owned Julietta project in Russia’s Magadan region, construction is ahead of schedule and the mine is 95% complete. Underground development drifting has advanced to a total of 2088 metres. The company is revising the mine development plan based on new data from underground development work.

Julietta will employ mechanized cut-and-fill mining at the rate of 350 tonnes per day. Milling will consist of conventional flotation and Merrill-Crowe precipitation.

The mine is expected to produce 113,000 oz. gold-equivalent annually over the initial five years of a nine-year life. Total operating cash costs are pegged at US$93 per oz.