LATIN AMERICA — Campbell explores near San Gertrudis

Despite the dramatic drop in the price of gold since last fall, Campbell Resources (CCH-T) has reported 6-month figures similar to those it recorded before the market took a dive.

During the first six months of the year, the company produced 45,300 oz. at an average cost of US$264 per oz., compared with 53,400 oz. at US$295 in the corresponding period of 1997. The average realized gold price rose to US$302 from US$354 per oz. between the two periods.

Mining at the San Gertrudis operation in Mexico’s Sonora state ceased during the second quarter, though the mine will continue to produce gold until all the ore on its leach pads is processed. Output over the 6-month period totalled 8,800 oz. at a cash cost of US$201 per oz., compared with 17,800 oz. at US$333 per oz. a year ago.

The cessation of mining at San Gertrudis does not mean Campbell is abandoning the region: by the end of August, the company expects to have acquired 900 ha adjoining the property to the north. The land package is said to be underlain by the same geology that characterizes San Gertrudis.

Meanwhile, Campbell has delineated a gold-in-soil anomaly 7 km north of San Gertrudis. The anomaly strikes north-south for 4 km and measures up to 1.5 km wide. Soil sampling returned a high of 2.49 grams gold per tonne, while rock sampling returned a high of 78 grams.

The anomaly is underlain by a 45-metre-thick unit of silicified and de-calcified siltstone and limestone. Reverse-circulation drilling is planned for October.

At the recently discovered Greta deposit, east of the Tracy deposit, trenching returned 4.2 grams over 14 metres, and 5.49 grams over 3.6 metres. The zone’s strike length is 100 metres.

Currently, geochemical surveys are being conducted on the Nely East target, which comprises three deposits. The first has a north-northeasterly trending strike length of 100 metres, and trenching here has returned 3.86 grams gold over 6.1 metres and 2.49 grams over 3.6 metres. Trenching at the second zone, which trends to the southeast over a strike length of 140 metres, returned 2.15 grams over 4.9 metres and 6.56 grams over 2 metres. Trenching at the third zone, which trends to the northeast for 50 metres, returned 2.49 grams over 3.6 metres.

Campbell plans to resume mining at San Gertrudis once it has established proven reserves of 200,000. The company has already proved up a reserve of 1.8 million tonnes grading 2.39 grams gold, equivalent to 140,000 contained ounces, in the Ontario, Tracy, La Gloria, Jasperoid, La Gloria Deep and El Tigre deposits.

Closer to home, at the Joe Mann mine in northwestern Quebec, lower production was attributed to the mining of low-grade ore. The mine produced 36,560 oz. in the recent 6-month period at a cash cost of US$278 per oz., compared with year-ago production of 35,600 oz. at US$276 per oz. Also, Campbell recently deepened the shaft at Joe Mann to the tune of $13.1 million ($1.4 million below budget).