Mixed results for partners

Despite decreased production at the Sleeping Giant and Beaufor gold mines in Quebec and lower realized gold prices, Aurizon Mines (ARZ-T) stayed in the black during the second quarter.

The company earned $381,000 (1 cents per share) on revenue of $5.9 million during the period, compared with earnings of $483,000 (1 cents per share) on revenue of $5.7 million in the second quarter of 1998. Cash costs climbed to US$230 per oz, up 11% from a year ago.

For the first half of 1999, the company earned $1.9 million (5 cents per share) on revenue of $13.4 million, up from earnings of $569,000 (2 cents per share) on revenue of $11 million in the first six months of last year.

Aurizon’s realized gold price for the second quarter was US$303 per oz., a US$30-per-oz. premium over the average spot price, but lower than the year-ago realized price of US$306. A foreign exchange hedging program realized a gold price of $474 per oz., compared with $435 per oz. in the second quarter of 1998.

Production for the quarter totalled 12,379 oz., down from 13,088 oz. a year ago. In the first half, 28,244 oz. were produced, an increase from the 25,112 oz. cranked out a year ago.

The bulk of production in the latest quarter came from the company’s half-interest in the Sleeping Giant mine, operated by Cambior (CBJ-T). Aurizon’s share of production reached 7,685 oz. in the first half, when production totalled 18,167 oz., compared with 15,329 oz. in the initial six months of 1998. Cash costs increased to US$226 in the second quarter, compared with US$207 a year ago, due in part to lower ore throughput and the conversion of the mill from a Merrill-Crowe recovery system to a carbon-in-leach extraction process.

From its half-interest in the Beaufor mine, which it operates, the company netted 4,694 oz., bringing the total production over the first six months of the year to 10,077 oz., up 3% from the year-ago period. Ore grade in the second quarter slipped to 8.2 grams from 8.5 grams per tonne a year ago. This plus decreased ore production led to a rise in cash costs to US$231 per oz., compared with US$218 in 1998.