Copper upturn helps Lornex

Copper prices reaching levels not seen since 1980 helped Lornex Mining Corp. (VSE) enjoy one of its better years, according to the company’s annual report.

Lornex has a 45% interest in Highland Valley Copper, the partnership with Cominco Ltd., TSE (50%) and Highmont Mining (5%), which is one of the largest copper mining operations in the world.

Profits soared in 1987 to $44 million from $27.3 million the year before (N.M., March 7/88). Cash balance increased to $94.9 million at year-end from $74.9 million at the end of 1986. Lornex’s share of capital expenditures in 1987 was $35.5 million compared to $8.3 million the year before.

The improved results are mainly due to higher prices for copper and lower unit production costs which more than offset the lower production of copper and molybdenum attributable to Lornex, the report says.

In late 1987 Highland Valley Copper completed a $55-million construction program integrating the large Lornex mill and the high grade Valley orebody. The program involved installing two large semi- mobile crushers in the Valley open pit mine and construction of two conveyors from the crushers to the mill.

From Jan 4, 1987, to Jan 3, 1988, the mill treated 41,999,000 tonnes of ore (averaging 115,067 tonnes per day) grading 0.435% copper and 0.011% molybdenum. Concentrate production amounted to 345,323,000 lb copper concentrate, 6,135,000 lb molybdenum and 1,658,000 oz silver. Relocate Highmont mill

In January, a $70-million program was initiated to relocate the Highmont mill to a site adjacent to the Lornex mill. When the relocation is completed late in 1989, daily milling capacity will increase to 131,000 tonnes per day.

Proven and probable ore reserves are 812 million tonnes with an average grade of 0.402% copper with recoverable amounts of molybdenum, silver and gold. Lornex also has a 39% joint venture interest in the Bullmoose mine in northeastern British Columbia with partners Teck Corp., TSE (51%) and Nissho Iwai Coal Development (Canada) (10%).

Lornex’s share of metallurgical coal production in 1987 was 663,000 tonnes compared to 693,000 tonnes in 1986. An agreement was reached with the Japanese buyers for a $14-per-tonne price reduction beginning April 1, 1987. This resulted in an average price for Bullmoose coal of $92.93 per tonne during the fiscal year.

Exploration expenditures in 1987 were $711,000.