Golden Bear output below forecast

Losses continue to mount for North American Metals (TSE) as a result of technical problems at the 50% owned Golden Bear mine in northwestern British Columbia. The mine has produced only 10,801 oz. of gold to Sept. 30 of this year, well below its forecast production of 44,785 oz. for the 9-month period.

The mine’s roaster has been down since August for repairs, and as a result, low-grade oxide ore from the open pit has been the primary source of mill feed.

Repairs and modifications to the roaster were completed in November and the unit was restarted. The company is now evaluating its performance.

The mill processed 52,700 tons of ore at an average head grade of 0.31 oz. gold per ton during the first nine months of the year. Recoveries averaged 78.1% over the period. Mill throughput increased to an average of 246 tons per day in the third quarter and 316 tons per day in October from an average of 179 tons per day in the second quarter of 1990.

As a result of the operating problems, the company experienced a cash flow deficiency of over $9.1 million after including changes in working capital items. Net loss for the nine months ended Sept. 30 was $7.2 million on revenues of $2.2 million.

The company’s share of cash calls for the period were $10.5 million leaving a cash balance of only $150,000.

The company recently completed a review of projected revenues and expenses over the remaining reserve life and concluded a substantial increase in the price of gold would be required for the company to recover its investment in property, plant and equipment.

As a result, Jack Thompson, president of North American Metals, announced the company would take a fourth-quarter writedown of $24 million.

As at Sept. 30, the company had a working capital deficit of about $1.3 million, a stated value for fixed assets and resource properties totalling about $41 million, and long- term debt of more than $42.6 million.006 North American Metals (TSE) 9 months ended Sept. 30 1990 1989 Revenue $2,151 nil Net earnings (loss) (7,364) (683)

per share (0.93) (0.09)004