Former Wharf directors take home $1.3 million

Wharf, which came under the control of Dickenson Mines (TSE) in late 1987, doled out about $1.3 million(US) last January pursuant to the resignations of certain officers and directors, the redemption of certain stock options and payment of severance allowances.

Expenses totalling more than $1.7 million were incurred during the same month when stock options involving 473,000 shares were exercised by certain officers and directors who had resigned, a severance payment was made gnder an employee agreement and payment of related expenses took place.

Since assuming control, Dickenson has continued to boost its holdings in Wharf, operator of a heap- leach gold mine in South Dakota, and has a 37.12% interest in the heap leacher. Further stock purchases are anticipated.

During 1988, Wharf recorded net income of $7.85 million (42 cents per share) compared with $4 million (23 cents per share) the year before. Operating cash flow last year amounted to $12.4 million, compared with $8.1 million the year previously.

During the first quarter of 1989, Wharf reported net income of about $1.3 million (6 cents per share) and produced 10,400 oz gold. Higher gold output

Gold production last year totalled 59,500 ounces which sold at an average price of $434 per oz, compared with 1987 sales of 46,000 oz at an average price of $453. Ore production in 1988 amounted to 1.5 million tons grading 0.046 oz gold per ton.

The company hopes to turn out 71,000 oz in 1989 by boosting production to 2.3 million tons. A new crushing and treatment plant costing more than $4 million was installed last year and about $3.2 million was spent on property acquisition, including $3 million on the remaining 50% interest in 350 claims belonging to Homestake Mining (NYSE).

Capital expenditures totalling $4.6 million, to be funded from working capital and operating cash flows, are planned for 1989. A further $1.7 million has been budgeted this year for exploration of properties in South Dakota, Wyoming and Nevada. Wharf’s proven and probable reserves total 24.3 million tons averaging 0.037 oz.

At the company’s recent annual meeting in Toronto, the board of directors was expanded to eight members. Elected to the board were R.W. Brissenden, R.P. Douglas (chairman), Donald Haldenby, J.O. Kachmar (president), Rene Lavertu, J.C. McCartney, R.R. McEwen and D.H. Searle.

McEwen is president of Goldcorp Investments Ltd. and Haldenby is a Goldcorp director. Goldcorp, a Toronto-based gold fund, recently became the controlling shareholder in Dickenson.

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