Rayrock quarter warmed by Nevada gold output

Per-share earnings for Rayrock Yellowknife Resources rose to 17 cents in the third quarter to Sept 30, compared with 14 cents per share for the first six months of the year.

The company attributes the gain to the higher gold production levels from the three Nevada gold mines — the Pinson, Prebble and Dee mines — in which it has interests, as well as to the increase in the gold price.

The per-share increase, Rayrock notes, occurred despite a substantial reduction in oil and gas revenue in the period.

For the nine months this year, Rayrock had net income of $3,062,000, or 31 cents a share, compared to $3,406,000 or 35 cents a share before non-recurring income in the comparable period last year.

The company’s share of gold production in the latest 9-month period from the Pinson and Preble mines rose to 16,372 oz from 13,639 in the similar 1985 period, and from the Dee mine to 11,247 oz from 10,671.

Rayrock notes that direct operating costs at all three mines are “outstandingly low” — $147(US) per oz at the Pinson and Prebble, and $165.59 per oz at the Dee.

Revenues from mining in the latest nine months soared to $19,822,000, close to double the previous year’s figure of $10,553,000, while oil and gas revenues dropped off to $5,722,000 from $10,599,000 in the 1985 period.

On the exploration front, Rayrock says drill results are encouraging from a program carried out on the Marigold project in the Battle Mountain area of northern Nevada by the Cordex Syndicate, in which Rayrock has a one-third interest.

And in Costa Rica, the company has acquired an option to explore a gold property which it says has the potential of several million tons in the 0.1- to 0.12-oz-gold-per-ton range.

Enjoying a healthy treasury, Rayrock reports a cash position as at Sept 30 of $12,632,000.

Associated company Discovery Mines, mainly a gas producer, reports income of $78,000 for the latest nine months, against income of $400,000 in the similar period last year. Revenues from petroleum and natural gas slid to $1,850,000, from $2,394,000 last year.

Discovery however has strong aspirations to find and/or acquire precious metals properties, (N.M., June 23/86), and in a late move in this direction, has optioned its 50%-owned Johnsby gold property in the Northwest Territories to Neptune Resources Corp.

Neptune can earn a 60% interest by spending $4,500,000 over the next four years.