Miramar extends Giant operations

Miramar Mining (MAE-T) has reached an agreement in principle with the Federal Department of Indian Affairs and Northern Development (DIAND), allowing the company to continue operating the Giant mine in Yellowknife, N.W.T.

Miramar has identified additional mineralization at the mine. The company says this can be economically mined and processed at the adjacent Con Mine. Operations are expected to continue until late 2002.

Also under the agreement, DIAND has agreed to assume from Miramar the responsibility of costs associated with environmental compliance and holding at the Giant mine, beginning Dec. 14 and continuing through the lifetime of extended operations.

Once operations at the mine wrap up, Miramar will oversee environmental compliance at the property for six months after formal notice. During the six-month notice period, DIAND will cover the cost of environmental compliance and holding of the property.

The environmental indemnity from DIAND and the reclamation security provisions of the existing agreements between Miramar and DIAND will be unaffected by the new agreement.

The agreement in principle is subject to the execution of formal documentation.

Miramar bought Giant from the Department of Indian Affairs and Northern Development when the receivers of defunct Royal Oak Mines returned the property to the government. It goes back to the department Dec. 14.

Miramar acquired the mine in 1999 to supplement production from the nearby Con Mine until additional reserves were accessed.

During the first half of 2001, the Con and Giant mines churned out 65,937 oz. gold, up from 56,202 oz. in 2000. Cash costs during the period were US$258 per oz., down from US$276 in the first half of 2000. The improved performance is attributed to modifications to the mining method and to better performance in the mill.

During the second quarter, the operation shipped 36,760 oz. gold. It produced 32,720 oz. from 66,579 tonnes of ore from Con and 17,125 tonnes from Giant. Mill head grade from both mines was 13 grams per tonne.