Geomaque losses shrink in 2002 (February 17, 2003)

Though still deep in the red, Geomaque Explorations (GEO-T) lost half as much in 2002 as in the previous year, thanks to higher gold prices.

The junior lost $4.6 million (or 3 per share) last year, compared with $10.5 million (17 per share) in 2001. Comparable revenues have not been disclosed, but Geomaque sold 30,369 oz. gold at an average US$313 per oz. in the more recent period, versus 27,077 oz. at US$275 per oz. a year earlier.

At the Vueltas del Rio mine in Honduras, which came on stream in mid-2001 and which remains the company’s sole producing asset, a total of 754,907 tonnes grading 1.68 grams per tonne were mined and placed on the leach pad. The grade consistently fell over the year, from an average 1.95 grams in the first quarter to 1.52 grams in the final one.

Cash costs averaged US$270 per oz., up US$29 from 2001.

Proven and probable reserves now stand at about 1.3 million tonnes grading 3.05 grams per tonne, while measured and indicated resources total 22.1 million tonnes grading 0.71 gram. Another 2.33 million tonnes, at 0.05 gram, are classifed as inferred resources.

Reserves are down 53% from a year ago, owing to actual costs ringing in higher and actual recoveries lower than had been predicted by the feasibility study. On the bright side, the stripping ratio has fallen.

On Dec. 31, Geomaque had a working capital deficit of $959,000. The shortage has since been offset by proceeds raised in a private placement of 11.6 million units at 8 per unit. A unit consists of a share and a warrant that exercised over the next three years, at 10.