MINING MARKETS & INVESTMENT NEWS — EASTERN MARKETS — Gold sinks on central banker’s comments

The Toronto Stock Exchange was held within a narrow trading range over the June 3-9 report period, with the TSE 300 composite index rising marginally to 7,535.43 points. Both mining sub-groups fell slightly during the relatively quiet week, with the metals and minerals index dropping to 3,623.72 points and the gold and precious metals index slipping to 6,299.83 points.

Over the week, gold’s spot price rose US80 cents to a London morning fix onJune 10 of US$294.15. However, gold had been slowly climbing through the week, topping US$298, until just before noon on June 9, when the spot price tumbled US$5 to US$293. The fall coincided with comments made by the president of the European Central Bank, Wim Duisenberg, who said there was an informal consensus that gold should constitute between 10% to 15% of the bank’s foreign reserves, a range on the low end of the markets’ expectations of 10% to 30%.

Etruscan Resources concluded an agreement with an Anglo American subsidiary to jointly develop Etruscan’s Tiawa gold concession in Niger, West Africa.

The Anglo unit can acquire a 50% undivided interest in Tiawa by paying US$5 million and subscribing for US$5 million Etruscan shares at $4 per share.

Prior to this announcement, Etruscan shares took a beating on news that Placer Dome had bowed out of the project, dropping from $3.85 to just $2.90 at closing on June 10.

The most active mining issue during the report period was International Uranium, which saw over 11 million shares change hands as the stock languished at 59 cents. Since topping $1.30 in February the company’s shares had been on a steady decline, dipping below 90 cents at the end of May.

However, a brief bout of heavy trading in early June pushed the share price down to a 52-week low of 40 cents before it rebounded to the 60 cents mark.

Nevertheless, the last eight months have been eventful for the Denver-based company, with operations getting under way at two uranium-vanadium mines in Utah and Colorado and drilling success at its uranium joint-venture projects in Mongolia.

Embattled SouthernEra Resources lost some investor confidence over the period, dropping another 50 cents to $4.75. Rumors surfaced June 3 that De Beers Consolidated Mines was demanding a 40% interest in SouthernEra’s Klipspringer diamond project in South Africa. The two companies have been at odds for several months over the mineral rights to the rich M1 kimberlite pipe, which was formerly a part of the Klipspringer project. De Beers has since denied an interest in Klipspringer as a whole, but says SouthernEra only held a prospecting licence for the M1 property, and is therefore not legally entitled to mine it.

International Curator shed 13 cents to close at 40 cents as the junior continues to seek out a joint-venture partner to help develop the copper-cobalt deposits of the Boleo property in Baja California Sur, Mexico.

Curator has reported that one possible suitor has broken off discussions.

Meanwhile, Curator has been evaluating a gypsum depositon the Boleo property.