Weak gold prices have forced Canyon Resources (CAU-X) to slow the permitting process at its McDonald gold project in Montana.
The company was spending US$500,000 per month on the environmental impact statement, which has been discontinued for at least six months owing to lack of funds. However, work on other major permit applications is continuing.
The slow pace of development is reflected in the share price, which fell in recent weeks to 44 cents from above $1.
The company had expected to secure a new joint-venture partner by this time.
However, recent months saw the collapse of two potential deals. (Phelps Dodge [PD-N] was a partner until September 1997, when the copper producer sold its 72% interest to Canyon.)
Situated west of Lincoln, the McDonald project contains a resource of 6.9 million oz. gold within 185.5 million tons of material grading 0.037 oz.
gold per ton, based on a cutoff grade of 0.016 oz. Barring any further delays, the operation is expected to start up in 2001, with annual production projected to exceed 300,000 oz.
From its Briggs mine in southeastern California, Canyon expects to crank out more than 70,000 oz. this year, which would be a record for that operation.
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