Chilly temperatures refuse to let up at Refugio mine

Severe winter weather in Chile continued to hamper the performance of the Refugio gold mine into the third quarter.

Ownership of the open-pit, heap-leach mine is split equally between Amax Gold (au-n) and Bema Gold (BGO-T).

The high-altitude operation produced 19,576 oz. during the quarter at operating cash costs to Bema and Amax of US$529 and US$543 per oz., respectively. The higher cost for Amax is due to a royalty payment.

For the first nine months of 1997, Refugio produced 108,186 oz. at a cash operating cost of US$313 per oz. for Bema and US$321 per oz. for Amax.

Production in both the second and third quarters was offset by severe winter storms and operational problems with the conveyors.

Production is expected to improve during the fourth quarter, and improved cash costs are forecast for the next two quarters. Amax expects to achieve full production in the first quarter of 1998. Over the next nine years, Refugio is projected to yield an average of 233,000 oz. per year at cash operating costs of less than US$250 per oz.

For the third quarter, Bema posted a loss of US$4.9 million (or US5.7cents per share) on revenue of US$3.8 million. During the first nine months of 1997, the company recorded a loss of US$5.6 million (US7.4cents per share) on US$21.1 million in revenue.