Despite a slowdown of mining activities, USMX (NASDAQ) earned US$330,000 (or 2 cents per share) last year, compared with a net income of US$2.6 million (or 17 cents per share) in 1993.
The company’s only gold-producer is the Goldstrike, in southwestern Utah, which produced 34,500 oz. in the year. Although mining ended in October, 1994, the company will continue heap leaching as long as it is economical to do so. The production cost for the year was US$229 per oz., compared with US$305 in 1993.
USMX hopes to advance several other projects towards a production decision this year, including the Illinois Creek gold-silver property in west-central Alaska. Having completed a preliminary feasibility report on the project, the company is proceeding with a full study, which incorporates a projected annual production of 50,000 oz. gold.
USMX confirmed the previously defined resource, estimated at 6.4 million tons grading 0.07 oz. gold and 1.5 oz. silver per ton with minable reserves of 3.9 million tons averaging 0.088 oz. gold and 1.7 oz. silver. Engineering and metallurgical studies indicate the deposit is amenable to open-pit mining and run-of-mine heap leaching, with a gold recovery exceeding 80%. An agreement with North Pacific Mining, an Alaskan native corporation, calls for an initial payment of US$50,000 plus an additional US$4 million in common shares upon initiating development and production. North Pacific can elect to participate in the development with a 25% working interest or receive a 5% net smelter return royalty.
USMX anticipates permitting will be approved in about one year, with development beginning by mid-1996. This year, the company will perform infill and exploratory drilling along extensions of the defined mineralization. Meanwhile, feasibility studies are also under way on USMX’s Thunder Mountain gold property in Idaho and on the Cala Abajo copper-gold property in Puerto Rico.
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