DIAMOND PAGE — High River posts profits

Lower costs and record production achieved by the New Britannia gold mine at Snow Lake, Man., have earned a third-quarter profit for High River Gold Mines (HRG-T).

New Britannia, a 50-50 joint venture between High River and operator TVX Gold (TVX-T), produced 25,825 oz. gold in the three months ended Sept. 30 for total production of 73,855 oz. in the first nine months of the year. The mine is expected to surpass planned 1998 production of 92,500 oz. It produced 91,415 oz. in 1997, well above the 85,000 oz. forecast.

TVX continued to make improvements to productivity at the mine. Cash costs fell to US$230 per oz. from US$237 in the previous quarter. In 1997, costs averaged US$274 per oz., and over the first nine months of 1998 they have averaged US$240. The mine also benefitted from a hedging program that pulled in US$445 per oz. in the third quarter and gave the company an average realized price of US$435 per oz.

Exploration drilling from the mine’s 3,000-ft. level intersected gold mineralization along the eastward strike extension of the Ruttan zone and downdip from the Dick zone.

High River showed a profit of $545,000 (2 cents per share) for the quarter, on revenue of $8.6 million. In the corresponding quarter of 1997, the company lost $620,000.

To Sept. 30, 1998, High River showed a loss of $3.3 million, after taking a one-time charge of $3.8 million in the second quarter from the sale of exploration properties in Nicaragua. Revenues were $24.1 million. In the first nine months of 1997, the company lost $2.8 million on revenue of $21.5 million.

Buryatzoloto, the Russian gold mining company in which High River owns a 23% interest, also had a good quarter, increasing total production for the current year to 76,446 oz. Its cash cost of production over the first nine months of 1998 was US$168 per oz.

The commissioning of a carbon-in-pulp circuit at Buryatzoloto’s mill means the operation will no longer have to ship concentrate to a smelter, and will probably see a further cash-cost saving of US$10 per oz.

At the Taparko project in northeastern Burkina Faso, where High River has a 61.5% interest, a feasibility study should be complete by the end of March 1999. The feasibility study is weighing the pros and cons of both milling and heap leaching, so additional metallurgical testing will be necessary; further definition drilling may also be required, to make an accurate outline of the higher-grade zones in the Taparko deposits.