Gold price forces Bell Creek closure

Citing weak gold prices, Canamax Resources (TSE) says it will close its only operating gold mine.

The Bell Creek mine and mill near Timmins, Ont., will be the third Canamax gold operation to close within the past 10 months. At the end of last year, Canamax placed both the Ketza River and Kremzar mines on care and maintenance. The underground Bell Creek operation, which employs 100 workers, produced 7,576 oz. of gold at an average operating cost of US$352 per oz. in the second quarter.

Gold has been trapped in a US$340-US$360 trading range for the past few months.

In mid-August, Falconbridge Gold (TSE) signed a letter of intent to purchase the mine and mill for $5 million. But after completing a due diligence survey on the assets, the senior company pulled out of the deal.

Bell Creek entered production at the beginning of 1987, and produces about 25,000 oz. gold per year. At the end of 1990, the mine contained proven and probable reserves of 358,914 tons grading 0.20 oz. gold.