Richmont changes plans at Beaufor (May 09, 2005)

Just one week after reporting its first quarter results Richmont Mines (RIC-T) along with its partner Louvem Mines (LOV-V) have announced an eight-week shutdown at their Beaufor mine, 27 km northeast of Val d’Or, Que.

The shutdown will take place in the third quarter of this year.

The companies are working on developing additional production areas in the mine. During the first quarter 515 metres of drifts, sublevels and raises were developed at a total cost of $441,970. By the end of the year, three levels should be available for production and the developed ore inventory should be double the current 25,000 tonnes. Production is virtually from one level at this time.

At the end of 2003, the Beaufor property had an estimated proven and probable reserve of 232,000 oz. of gold contained within 924,000 tonnes of ore grading 7.8 grams gold per tonne. Last year, 53,240 tonnes of ore were processed with an average grade of 5.74 grams gold per tonne.

Indicated and measured resources stood at 173,400 oz. gold at the end of last year.

Gold at Beaufor is within quartz-tourmaline veins in shear zones within the Bourlamaque granodiorite. Ore is processed at Richmont’s Camflo mill. It is expected that the mill will continue to operate over the shutdown, processing a bulk sample that will be taken from Richmont’s East Amphi property.

Beaufor’s forecast production for this year has been reduced by 11%, to 48,000 oz. gold. During the first quarter of this year Beaufor produced 13,589 oz. gold. The mill processed 65,916 tonnes grading 6.4 grams gold per tonne.

Richmont owns a 70%-stake in Louvem Mines.

Richmont had net earnings of $100,547, during the first three months of this year, up from a $1 million loss during the same quarter last year. The company sold its production for an average of US$428 per oz., US$12 higher than a year earlier. This gain was offset in part by the higher Canadian dollar, which averaged US4 higher during this year’s quarter, at US81.

Exploration costs at Richmont’s East Amphi gold property totalled over $3 million during the quarter. The main ramp has been extended 183 metres to 200 metres vertical depth. In addition, 730 metres of drifting and crosscuts have been completed. Exploration drilling is underway and an updated reserve and resource estimate will be calculated.

During the quarter the company spent $1.8 million underground at the Island Gold project, 15 km from Dubreuiville, Ont. Richmont is earning a 55%-interset in the property from Patricia Mining (PAT-V).

At the end of March, Richmont had $20.2 million in cash, cash equivalents and short-term investments and 16.17 million shares outstanding. Shares are presently trading at about $4.50.

Richmont is also earning a 70%-interest in the Valentine Lake gold property in Newfoundland from Mountain Lake Resources (MOA-V).