Some unexpected developments at Audrey Resources’ (TSE) Mobrun polymetallic mine near Rouyn-Noranda, Que., contributed to an unprofitable first quarter for the company. Audrey reported a net loss of $1.4 million or 9 cents per share in the three months ended March 31, compared with a net loss of $106,600 or 1 cents per share in the first quarter of 1989.
As Mobrun was shut down during most of last year for mill construction and mine development, Audrey’s first-quarter revenues were well ahead of 1989 levels. Audrey reported revenues of $4.1 million in the first quarter compared with $37,600 in the equivalent period last year.
According to President Guy Hebert, the financial results would have been different had his company been able to add high-grade ore from a 52,000-tonne ore block as scheduled in the original mining plan. Audrey said efforts to replace a steel grate at one of the mine’s ore passes prevented it from mixing high-grade material with the low- grade ore block.
Costs related to the preparation of an additional 180,000 tonnes of ore, scheduled to be milled over the next six months, also contributed to the first-quarter loss, Hebert said. However, none of these events should prevent Audrey from realizing a projected operating 1990 profit of around $6 million, he claims.
Meanwhile, Audrey continues to develope Mobrun’s new 1100 lens in a 50/50% joint venture with Minnova (TSE). With 75% of the underground development work now complete, geological reserves in the 1100 lens stand at 15.5 million tonnes of grade 0.83% copper, 4.64% zinc, 35.9 grams silver and 1.26 grams gold.
Included in that amount are minable reserves of 10.4 million tonnes grading 0.76% copper, 5.43% zinc, 37.40 grams silver and 1.35 grams gold.
Finally, the search for additional lenses within the Mobrun property is continuing. Audrey says it is still assessing a strong geophysical anomaly situated 2,400 ft. below surface and 300 ft. southeast of the 1100 lens. The existence of massive sulphides in the area was confirmed by a drill hole that intersected 50 ft. of stringers and 3 ft. of massive sulphides at a depth of 2,180 ft. However, a second hole located 300 ft. below and 200 ft. east of the first hole came up empty.
Having stopped surface drilling (probably until July), the company is currently surveying the region and reevaluating data obtained from holes completed so far. Northgate Exploration (TSE) owns 18% of Audrey. $000s except per-share items Quarter ended March 31 1990 1989 Revenues $4,128 $37 Net earnings (loss) (1,445 ) (106)
Per share (0.09 ) (0.01)
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