LAC says its strong financial position combined with forward gold sales will enable the company to weather the current downturn in gold bullion prices.
In 1988, the company’s average realized price for gold was $470(US) per oz compared to $449(US) per oz in 1987. However, a stronger Canadian dollar resulted in a lower gold price when translated into Canadian dollars. Average operating costs increased to $260(US) per oz from $235(US) in 1987.
In 1988, LAC’s largest contributor, in terms of profitability and ounces of production, continued to be the Doyon mine in Quebec. Owned 50% by the company, Doyon produced 139,157 oz of gold at a cost of $264 per oz to LAC’s account. At current gold prices of about $395 per oz, LAC’s Bousquet No 1 is operating at breakeven. In 1988 operating costs averaged $391 per oz, down from $409 per oz in 1987.
At Kirkland Lake, Ont., LAC’s Macassa mine is also relatively high cost in light of current depressed prices. Macassa’s operating costs averaged $361 per oz in 1988.
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