The recent quarterly performance reflects a gain of $2.1 million on the sale of marketable securities, whereas the year-ago loss included a writedown of $16.8 million on the carrying value of the Con mine in the Northwest Territories, as well as several undeveloped properties.
Since mid-May of 1998, the Con mine has sat idle owing to a strike. At the beginning of the year, Miramar took dramatic steps to slash high operating costs at the underground mine by reducing the workforce and scaling back daily production to 600 from 1,200 tons. When production was suspended in May, the mine had produced 23,477 oz. at a cash cost of US$343 per oz.
Proven and probable reserves at the end of 1997 stood at 2.5 million tons grading 0.33 oz. gold per ton, equivalent to 825,000 contained ounces.
In September 1998, Miramar repurchased for cancellation $22 million worth of convertible unsecured debentures. These were issued Oct. 25, 1995, and are due Oct. 25, 2001. The debentures were repurchased for $14 million plus accrued interest.
Miramar ended the third quarter with working capital of $92.4 million.
The loss is a reflection of the Mantua gold-copper project in Cuba and of overhead costs related to Northern Orion’s exploration activities in Latin America.
The Mantua open-pit mine, which was developed in a 50-50 joint venture with state-owned Geominera, poured its first gold in February. During the third quarter, the mine produced 6,404 oz. gold (3,202 oz. to Northern Orion’s account) at a cash cost of US$249 per oz. For the year to date, the mine has cranked out 11,473 oz. at US$235 per oz.
Proven and probable gold reserves are estimated at 1.3 million tonnes grading 2.03 grams gold per tonne, whereas copper reserves are pegged at 7.5 million tonnes grading 2.74%.
The Mantua mine did not generate sufficient cash to pay off the US$9.6-million capital loan; accordingly, Miramar paid US$1.8 million under its guarantee.
Meanwhile, at the Agua Rica porphyry project in Argentine’s Catamarca province, a US$8.4-million work program is in progress. The minable resource is estimate at 681 million tonnes grading 0.59% copper and 0.03% molybdenum, plus 0.25 gram gold and 3.61 grams silver, equivalent to a contained resource of 8.9 billion lbs. copper, 496 million lbs. molybdenum, 5.5 million oz. gold and 79.1 million oz. silver. The overall stripping ratio is 1.8-to-1.
BHP Copper, a unit of
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