Gold makes comeback

Only a few weeks ago, gold dropped to its lowest level in 36 months after an unprecedented 2.5-year-long slide from its 1980 record high of US$850 per oz. However, the yellow metal has now soared back to a 15-month high on speculative investor and hedge buying.

At US$488.50 per oz., the yellow metal has now advanced a full 65% from its low, posted on June 21. The bulk of the price recovery has come in the past two weeks as it became evident that the world banking system is passing through its worst crisis since the 1930s.

Worries that Latin American economic woes could destabilize the U.S. and European banks resurfaced following rumours that Argentina may be about to repudiate its debt and nationalize the country’s banks. Argentina owes US$39 million to foreign banks.

Agnico-Eagle basks in golden glow

Agnico-Eagle Mines is basking in the renewed market glow of gold. As a leading producer of gold and silver, the company stands to benefit from the current upturn in precious metals prices.

What puts Agnico-Eagle in an enviable position is not only the gold division’s rising productivity, but also its success in reducing costs.

In the first half of 1982, the division turned out 26,354 oz. gold, and the average cost of gold per ounce fell to $212.94, from $323.91 in the year earlier period.

If September is as good as July or August, says President Paul Penna, net revenue of the gold division for the third quarter should increase by 75% or more, year over year.

Property has Falco thinking zinc

Falconbridge Copper reports encouraging drill results from its copper-zinc find near Thunder Bay, Ont., optioned from Zenmac Explorations.

The area is being heavily staked by various companies, including Noranda Mines.

Falco’s latest hole intersected 11 metres grading 1% copper and 8.58% zinc, plus 17.8 grams silver per tonne, at a down-hole depth of 533.5 metres. Drilling will continue for the remainder of the year.

Chrtien a good choice

In resigning ourselves to having to live with a federal Liberal government for another two years, we have mixed feelings about Prime Minister Trudeau’s shuffling of several senior cabinet ministers.

We believe that the appointment of former Justice Minister Jean Chrtien to the portfolio of energy, mines and resources is the best that Trudeau could have made from the limited selection of talent available.

Chrtien, who remains one of the Trudeau cabinet’s most popular ministers, will likely find that his reputation for robust forthrightness will be an asset in his dealing with industry. His appointment has to be viewed as a positive one, from the viewpoint both of his previous association with resource industries and his acknowledged pragmatism.

More gold at Hemlo

It looks as though a fourth gold deposit has been found in the Hemlo area of Ontario.

A second hole drilled on the property held by Goliath Gold Mines intersected 98.2 ft. grading 0.256 oz. gold per ton. The mineralization occurs downdip from the discovery made earlier this year by Long Lac Minerals Exploration. The property is being explored in a joint venture with Golden Sceptre Resources. Since the intersection is within a sedimentary environment, there is good potential for large tonnage.

Teck slashes debt

Teck has taken another step to reduce its substantial debt load and “strengthen its debt-to-equity ratio,” says President Norman Keevil, Jr.

The company has reached an agreement with Redclay Holdings to sell slightly less than a minority interest in the Highmont mine, a copper molybdenum producer in British Columbia’s Highland Valley, near the huge Lornex copper-moly mine, in which Teck owns a 21.6% stake.