The loss includes a combined writedown of $8.2 million resulting from a reassessment of ore reserves at the company’s shutdown Kingston mine in Nevada, and a writedown on investment in the Empire gold project, west of Denver, Colo.
The option of Marquette Minerals to purchase Nevada Goldfields’ interest in the Empire project expired on Sept 16, and the company said it plans to recommence development on that project with its other joint venture partners.
In order to fund exploration programs at its Kingston mine and Manhattan project, the company is holding discussions with potential joint venture partners and equity investors.
The 1989 loss also includes depreciation, depletion and amortization totalling $7.6 million.
During the latest fiscal year, the Kingston mine produced 25,131 oz of gold at a cash cost of $343 per oz, compared with 39,247 oz at $246 per oz last year.
The company’s Aurora mine, situated south of Hawthorne, Nev., produced 12,714 oz of gold at a cash cost of $233 per oz, compared with 10,302 oz at $178, a year ago.
Discussions are also being held with the company’s bankers regarding the possibility of rescheduling its gold loan and interest payments. The gold loan is carried at $13.3 million deferred revenue, but at current market value amounts to $10.6 million. Shares of Nevada Goldfields have traded recently at $1.30 on The Toronto Stock Exchange.
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