Vancouver — Yet another junior producer feeling the pinch of historically low gold prices is
The company, which operates gold mines in Quebec and Newfoundland, saw its revenue plunge to $6.1 million, from $10.2 million in the corresponding period last year.
Richmont decided to take a $4.2-million writedown on its Nugget Pond mine, as well as a $1-million provision for site restoration. Lower grades and higher costs at the Newfoundland mine prompted the company to take action. Situated near La Scie, the operation produced 1,600 oz. gold during the quarter at an average cash cost of US$366 per oz.
At the Hammerdown project, northwest of Springdale, Nfld., the company continued its development work. So far this year, Richmont has put $3.5 million into the property. Since early July, the ore has been transported to the Nugget Pond mill, which treats 375 tons per day at an average grade of 0.6 oz. per ton.
Francoeur hoisted about 60,000 tons in the quarter, producing 12,200 oz. gold at a cash cost of US$319 per oz. Depletion of reserves will force the Quebec operation to close by October.
At the Beaufor mine in northwestern Quebec, Richmont hopes to resume operations before year-end. Mining was suspended last year while geotechnical studies evaluated the safety of the operation. Richmont recently acquired
Acting as operator, Aurizon suspended mining at Beaufor in August 2000, owing to concerns over pillar stability. The partners commissioned an independent firm to assess the pillars.
They now say the report concludes that mining can safely resume once hydrostatic barricades are installed and certain near-surface stopes are backfilled. The cost of this is estimated to be $4.5 million.
Beaufor’s proven and probable reserves stand at 1.1 million tons grading 0.22 oz. gold per ton, or 237,000 contained ounces.
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