By lowering costs,
Earnings topped US$402,000 (or 1 per share) on revenue of US$5.5 million, compared with US$89,000 on US$6.2 million in the first quarter of 1999. Lower but cheaper production at the San Francisco mine in Mexico accounts for the difference.
The open-pit, heap-leach mine cranked out 17,012 oz. at US$224 per oz. in the recent quarter, compared with 19,300 at US$240 per oz. a year ago. Total costs between the two periods decreased to US$266 from US$294 per oz., whereas realized gold prices remained essentially unchanged at US$319 per oz.
Just over 1 million tonnes of ore were crushed and stacked on the leach pad, up 27% from the previous quarter and 17% from a year ago. The trend continued into April, when 329,000 tonnes were crushed.
Mining at San Francisco is scheduled to end in August, though leaching will continue for another year. In order to boost cash flow, crews have been focusing on areas requiring the least amount of stripping. Mining at the Chicharra zone began in March; reserves there stand at 1.6 million grading 1.2 grams gold, at a stripping ratio of 1.8-to-1.
Exploration continues in the vicinity of the mine, with a 1,000-metre drill program scheduled to begin shortly.
Meanwhile, Geomaque expects to soon close a US$3.5-million financing that will enable it to resume and finish construction at the Vueltas del Rio project in Honduras. Commercial production should begin in the fourth quarter.
A proposed open-pit, heap-leach operation, Vueltas del Rio is expected to crank out 60,000 oz. gold annually at a life-of-mine cash cost of US$169 per oz. The phase-one leach pad and process ponds are already complete, and the gold plant fabricated. Also, the ore-handling system is in place.
Reserves are pegged at 5.6 million tonnes grading 2.5 grams gold per tonne. At the budgeted daily milling rate of 3,000 tonnes, these are sufficient for five years of production.
On March 31, Geomaque had US$5.5 million in working capital; its long-term liabilities stood at US$1.6 million.
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