Cambior looks beyond North America

In its first major exploration project outside North America, Cambior (TSE) is negotiating an agreement involving gold property in Indonesia. Cambior, based in Val d’Or, Que., says it has reached an understanding in principle with Dominion Mining of West Perth Australia covering about 17,000 sq. km on the Island of Kalimantan.

The Canadian gold producer may earn a 50% interest in Dominion’s 82.5% interest in the property by spending A$8 million on exploration work during a 3-year period. Dominion will act as operator of the work program.

In 1989, Cambior produced 189,483 oz. gold at a cash cost of $322 per oz. Gold output was down slightly from the previous year; the cash cost in 1988 was $284 per oz. The company has interests in seven mines in production or under development. The company’s output target for 1990 is 220,000 oz.

Net earnings in 1989 totalled $17.7 million, up slightly from the previous year. Cash assets exceed $85 million and the company’s long-term debt is “virtually nil,” it says.

Cambior continues to reap benefits from its hedging program of forward selling and gold loans. At the end of last year, the company had committed almost 60% of its forecast 1990 gold production at US$486 per oz.

Newest of its gold projects about to enter production is the Silidor in the Rouyn-Noranda, Que., area. Cambior has a 25% interest in Silidor, which is up and running but has yet to reach commercial production. (Noranda, the operator, has a 55% interest, and Nova- Cogesco Resources a 20% stake.) Total mine output this year is expected to be 59,200 oz. and in 1991, 73,600 oz.

Twenty-five miles east of Rouyn- Noranda, Cambior is preparing a feasibility study for its Mouska gold project. Preproduction work for the project could be started this year.

Cambior’s largest producing property is the Doyon mine, 25 miles east of Rouyn-Noranda. Cambior and LAC Minerals are 50/50 partners in the mining operation which turned out 234,692 oz. gold last year. Mine production for 1990 is expected to total 225,000 oz.

On the exploration side, the company plans to spend $9.5 million on surface exploration work this year. Last year Cambior spent about $7.2 million on gold and polymetallic exploration; 60% was invested in Canada, 38% in the U.S. and 2% in South America. Joint venture partners contributed an additional $3.8 million to the various work programs.