Meridian enjoys record-low costs at El Penon

Meridian Gold turned in another solid quarter, posting a profit of US$10.3 million, or US$0.14 per share, on the operational strength of the El Penon mine in Chile, which produced 88,000 oz. gold at an eye-popping record cash operating cost of US$25 per oz. gold.

For the first quarter, Meridian produced a total of 110,588 oz. gold at a cash cost of US$78 per oz., with the remaining gold output being derived from the Jerritt Canyon mine in the U.S.

First-quarter sales revenue increased 19% over the prior year to US$31.1 million reflecting the increased production from El Penon and higher realized gold prices. Meridian’s average realized gold price was US$294 per oz. versus US$276 per oz. in the prior year.

In early April, Meridian and England’s Brancote Holdings signed an agreement to merge based on a pre-conditional offer to be made to Brancote shareholders. Each Brancote share will be exchanged for 0.1886 Meridian shares.

For 2002, Meridian expects to produce more than 300,000 oz. gold from El Penon at a cash cost of less than US$50 per oz.; and 100,000 oz. from Jerritt Canyon at a cash cost of US$220 per oz.