Equinox uses Buckhorn profits to pay back costs in first year

The past year has been an exciting one for Equinox Resources. Cash flow from the Buckhorn mine enabled an 11- month payback on the company’s $1.7 million(US) acquisition cost. A gold discovery at Buckhorn and exploration successes on several other precious metal and platinum properties highlighted the year.

Operating cash flow for the year ended Oct 31 was $2.2 million and net earnings amounted to $565,705. The Buckhorn mine in Eureka Cty., Nev., owned 24% by Equinox and 76% by Cominco Resources International generated most of the earnings. Sales of 37,779 oz gold and 200,747 oz silver produced revenue of $5.3 million. The average selling price for gold was $434, compared to an average production cost of $181 per oz.

Proven reserves at Dec 31 were 1,094,000 tons grading 0.046 oz gold per ton. New reserves of 550,000 tons were discovered, as against 784,000 tons crushed and placed on the heaps.

Most exciting development at the mine was the discovery of high grades at the West Sinter zone. An intersection of 55 ft grading 1.1 oz was announced in September. This was followed with other high grade drill intersections including one of 165 ft grading 0.8 oz (N.M., Jan 25/88).

In October the company acquired a 60% interest in the Maude Lake gold deposit in Ontario containing reserves of over one million tons grading 0.1 oz. A joint venture agreement with Technigen Corp. will reduce the interest to 24%. Equinox is operating a $5-million underground program at Maude Lake and hopes to advance the property into production in the near future, President Ross Beaty says.

Equinox also purchased a 100% interest in the Zenda gold deposit in southern California on which Shell Mining Co. had developed a heap leachable gold deposit. The company plans to spend $2.2 million to bring the mine on-stream this year.

More than $6.1 million was spent on exploration in fiscal 1987 on 46 properties in North America. Priority was given to the search for platinum, through a $1.3-million program funded 40% by Equinox and 60% by Technigen. This program investigated a number of potential platinum properties in Canada, and on the Muskox property in the Northwest Territories grades in excess of 4.6 oz per ton were discovered. Further work will be carried out in 1988.