NEVADA AND THE WESTERN STATES — Low-cost Cortez mine leads Placer Dome’s pack

Although it produces gold at a multitude of operations strewn across four continents, Placer Dome(PDG-T) is mining the yellow metal most economically at the Cortez mine

in Nevada.

Placer, as operator, holds a 60% interest in the mine; the remainder is held by Kennecott Explorations (Australia), a unit of Rio Tinto (RTP-N).

Placer’s first-quarter gold production from the U.S. increased by 43% over the corresponding period in 1997, thanks, in large part, to a 164% boost in its share of production from Cortez, to 64,061 oz. gold. The increase is related to the commissioning of a new mill in March 1997 and the start of mining at the Pipeline pit three months later.

Production in the first quarter of this year was hampered by dewatering in the Stage I pit, which necessitated the mining of ore from the lower-grade Stage II pit. Nevertheless, Cortez achieved the lowest first-quarter cash production cost in the Placer portfolio — US$95 per oz. gold. By comparison, the production cost a year ago was US$234 per oz.

Placer and Kennecott’s Cortez joint venture, situated in northeastern Nevada, consists of the original Cortez mine, which commenced production in 1969, and the adjacent Pipeline property.

The Pipeline mill was completed three months ahead of schedule at about $250 million. The plant has a nominal capacity of 7,300 tonnes of ore per day.

The original Cortez facilities continue to process ore from the Pipeline-South Pipeline pit, giving the overall operation a total production rate of 9,300 tonnes per day.

In 1981, the original Cortez mill was converted to a carbon-in-leach (CIL) plant from a standard countercurrent decantation Merrill-Crowe plant. In 1990, a dry grinding plant and a circulating-fluid bed roaster were constructed for oxidation of refractory ores prior to processing in the CIL mill. Refractory ore processing temporarily ceased in February 1996.

In addition to achieving technological advancements in refractory ore processing, Cortez was the first Nevada gold producer to employ heap leaching successfully as a stand-alone method of ore treatment.

Placer Dome’s share of combined Cortez-Pipeline production is budgeted at about 500,000 oz. gold in 1998 at a cash production cost below US$100 per oz. The Pipeline property is expected to produce more than 6.8 million oz.

gold over 15 years, with life-of-mine cash production costs pegged at roughly US$135 per oz. gold. This is lower than previous estimates as a result of increased production and revised mining and dewatering costs.

At year-end 1997, proven and probable reserves at the Cortez joint venture, including stockpiles, totalled 97.6 million tonnes grading 2.5 grams gold per tonne, for 7.05 million oz. gold.