Toronto Stock Exchange (December 09, 1991)

Inco affiliate Fort Knox Gold roared to a new high of $3.05 on a volume leading 2.1 million shares during the week ended Dec. 3 before trading was halted at the request of The Toronto Stock Exchange.

“We want to ensure that everyone is trading on a level playing field,” said Neil Winchester, head of market surveillance at the TSE. In a telephone interview with The Northern Miner, Winchester expressed concern about the lack of available information to support such activity.

A subsequent press release issued by Fort Knox indicated that more results from its Shining Tree nickel play won’t be available until mid-December. That together with some unfavorable comments by Richardson Greenshields analyst Ray Goldie persuaded some investors to unload the stock.

As a result, the issue fell as low as $2.35 today, Dec. 4, and closed at $2.72 on a volume of 823,685.

Elsewhere this week, some negative economic indicators including a record third-quarter deficit sent share values spiralling downward as nervous investors moved out of equities and into bonds.

Today, the composite 300 index hit negative territory for the third time in a row. Losing 25.9 points, the index closed at 3427.5 after 24.3 million shares worth $267.7 million changed hands. Political unrest in the Soviet Union exerted pressure on gold which fell by US$1.25 an oz. during the report period to close at US$365.25 today in London.

Among gold issues, LAC Minerals ranked second behind Fort Knox on the active list, trading 1.5 million shares. Today LAC and Royal Oak Mines were both unchanged at $9 and $1.50 respectively. Placer Dome and American Barrick Resources gave up 13 cents and 38 cents. After climbing to $1.35 earlier in the week, Mentor Exploration was inactive today.

Hemlo Gold’s 60% owned affiliate Crown Butte Resources lost some steam after gaining 88 cents throughout the week. Owner of the New World gold-silver project in Montana, Crown Butte was down 25 cents today to $10.63. Ironically, as investors were focusing on Fort Knox’s Shining Tree nickel play, Falconbridge was agreeing to sell three Northwest Territories copper zinc projects to Minnova for US$20 million plus royalties. The agreement allows Falconbridge to concentrate on its core nickel business, especially the Ungava project in northern Quebec, and to beef up reserves at Minnova. A subsidiary of Noranda affiliate Kerr Addison Mines, Minnova advanced by 13 cents today to finish at $16.13.

Rio Algom was even at $15.50 after cancelling plans to purchase the 92% interest in Uranium Resources it doesn’t already own due to low uranium prices.

However, Cameco Chairman William Gatenby says the Saskatchewan uranium company will remain in the black despite current prices. In a recent interview with the Dow Jones Service, Gatenby said Cameco needed uranium to trade at US$20 per lb. to generate a good return on investment. Pressured by heavy selling in the Soviet Union, uranium traded this week at $7.25 per lb. Cameco stalled at $13.25, just above its annual low.

Campbell Resources has given the green light to a $10-million shaft-sinking project at its Joe Mann gold-copper mine in Chibougamau, Que. Campbell is extending the shaft from 2,011-2,700 ft. to reach deeper reserves. WisCan Resources made the active list as Noranda Exploration prepared to start drilling on the company’s base metal properties in Wisconsin. Trading over half a million shares, WisCan finished at 23 cents.

TVX Gold has agreed to sell its 34% (5.4 million shares) interest in High River Gold Mines to Restech International of Australia. As a result, the Australian company and subsidiaries will have 44% of High River. TVX didn’t trade today.

Because of poor market conditions, Curragh Resources cancelled a planned $55-million convertible debenture offering this week and put its Westray coal project in Nova Scotia up for sale. Trading at $4.13, Curragh is uncomfortably close to its annual low of $4.