The Lupin gold mine in Nunavut will be reopened following a shutdown that lasted nearly two years.
Annual production is pegged at 150,000 oz. gold, with life-of-mine cash costs expected to average US$245 per oz. Reserves are sufficient for five years of production.
Meanwhile, Echo Bay reported a loss of US$23.3 million (or 17 cents per share) for the three months ended Sept. 30, compared with US$9 million in the corresponding period of 1998. Much of the difference is attributed to the proposed sale of the company’s 60% interest in the Paradones Amarillos property; were if not for such extraordinary items, Echo Bay would have lost only US$6.1 million.
In October, Echo Bay agreed to sell its 60% interest in the Paradones Amarillos property in Mexico to partner
Revenue for the periods was roughly the same, at US$54.2 million.
Echo Bay produced 127,995 oz. gold and 1.3 million oz. silver in the recent quarter, down 14% and 35%, respectively, from the corresponding period of 1998. Accordingly, cash operating costs rose US$18 to US$220 per oz.
A blemish on the period was the McCoy-Cove mine in Nevada, where production dropped 42% to 29,173 oz. and cash costs rose 28% to US$258 per oz. The poor performance is attributed to dwindling, lower-grade stockpiles.
Higher production and lower costs at the 50%-held Round Mountain mine, also in Nevada, only partially offset lower production and higher costs. The mine contributed 74,422 oz. — 8% more than in the third quarter of 1998. Cash operating costs were down US$8, to US$178 per oz.
At the Kettle River mine, in Washington state, production declined to 24,400 oz. at US$257 per oz., compared with 29,363 oz. at US$241 per oz. a year ago. The shortfall is due to deeper mining and greater haulage distances. Mineralization east of the K2 deposit will soon be subjected to exploration drilling.
Cash flow from operations topped US$10.6 million, of which US$8.2 million was reinvested in capital items.
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