Golden Rose mine blamed for Noramco Mng. losses

Losses reported on Noramco Mining’s (TSE) balance sheet during the first six months of 1988 were due largely to problems at the Golden Rose mine west of Thunder Bay, Ont., the company announced recently.

A lower than expected production rate contributed to a first half loss of $3.75 million or 23 cents per share Noramco said. Results of operations at Golden Rose are no longer being capitalized for financial reporting purposes and as a result, the $3.75 million operating loss was charged directly to Noramco’s income statement.

A shortage of mineable working faces and start up problems in the mill are among the factors responsible for the low production rate, said President Brian Pewsey. In the three months ended June 30, 22,502 tons of ore were processed at a grade of 0.087 oz gold per ton.

The company said it has assembled a new development team headed by Fred Sveinson, vice- president, operations. Under what Noramco calls a comprehensive rating plan, Noramco will extend the ramp from the third to the seventh level, increase the rate of upper level development and purchase additional underground equipment.

Modifications to the mill circuit, including the purchase and installation of additional equipment, are also underway, the company reports. The objective is to develop sufficient working faces and stopes to supply the mill by December 31 with 425 tons per day at a grade of 0.23 oz gold.

With six stopes currently in production, Noramco is aiming to add an extra four by year end.

Meanwhile, an engineering evaluation is being carried out at the company’s Pickle Crow property in northwestern Ontario to determine the next phase of exploration.

Beginning in September, the next phase should encompass stripping, surface trenching and the installation of underground ramps on some of the high grade veins and iron formations.

Stripping and trenching are also planned for the Favourable Lake property in northwestern Ontario during the next phase of exploration, according to the company.

A pre-feasibility is also underway at Noramco’s Estrades property in northwestern Quebec. “A positive prefeasibility study will likely result in a major development program in the ore to provide a bulk sample for detailed metallurgical work and develop a mining method,” said Pewsey.