Vancouver — Viceroy Resources (VOY-T) cleaned up its balance sheet during the second half of 2001 and as of Jan 1st had $5.9 million unrestricted cash in its coffers. The junior is now looking for new opportunities in North and South America.
The company settled its $3 million outstanding debt with its lenders, NM Rothschild and Macquarie Banking. Viceroy achieved this by paying $700,000 in cash, issuing 23 million shares and relinquishing its equity position in NovaGold Resources (NRI-T). The junior also issued a convertible note worth $3 million, which has since been paid. Viceroy now has over 80.6 million common shares issued and Rothschild has become a significant shareholder, holding 19.7% of the junior.
Trickledown operations, during the second half of 2001, at both of Viceroy’s North American mines, the 75%-owned Castle Mountain mine in California and wholly-owned Brewery Creek mine in the Yukon, produced 22,500 oz. and 7,600 oz. of gold, respectively. The company anticipates that gross cash costs, including on site reclamation, will be US$115 and US$280 per oz. gold, respectively.
Viceroy has also inked a deal with the Canadian government which provides for the establishment of a reclamation trust. The trust will contain $8 million in cash deposits, which have been set aside by Viceroy for the future reclamation of Brewery Creek mine.
Currently, the company’s unrestricted cash position stands at $5.9 million and excludes $14.4 million restricted cash for reclamation purposes. Viceroy intends to refocus its attention to tax effective exploration and development opportunities in North and South America as well as recovering the value of its investments in Australia. During the third quarter of 2001 the company wrote down its entire investment in Australia by $17.7 million.
Viceroy reported consolidated earnings of $714,000, or 1 per share, during the third quarter of 2001, compared with a loss of $16.7 million, or 28 per share in 2000.
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