Queenston hopes riding on Kirkland, Anoki bets

The Toronto-based company earned $205,000 in royalty income from LAC Minerals’ (TSE) Macassa mine during the first nine months of 1988. But success at any one of at least two joint ventures could see Queenston safely into the production leagues.

The Macassa operation is adjacent to Queenston’s Kirkland West property where joint venture partner LAC Minerals is attempting to find mineable ore about 6,000 ft below surface.

LAC is currently drifting on three levels in a system known as the Kirkland Lake “Main Break” which has produced 23 million oz gold and supported seven gold mines since 1913.

The system stretches from the Macassa property onto Queenston’s Kirkland West claims for 6,000 ft. But whether or not LAC will find a mineable ore body on Queenston ground has yet to be determined.

Meanwhile Queenston (35%) and partner Inco Gold (65%) are in the late stages of a feasibility study at the Anoki gold deposit near Larder Lake, Ont.

The joint venture has spent $7 million on an underground program to confirm reserves which stand at about 600,000 tons grading 0.14 oz gold per ton to the 700 ft level. Since Queenston’s 35%- owned McBean mill is just a stone’s throw from the property, Chairman Hugh Harbinson is hopeful that Anoki will eventually be mined. But Inco isn’t expected to announce a decisions until February at the earliest.

Further north at Queenston’s Upper Canada mine property Inco has the option to earn a 50% stake by spending $5 million. Results from a phase 1 surface drilling program are being evaluated.

American Barrick Resources (TSE) recently completed 69,000 ft of drilling at the Pandora joint venture near Cadillac, Que. where 2.5 million tons of drill-indicated geological reserves grading 0.14 oz has been outlined.

An additional 15,000 ft of drilling was to be completed before the close of 1988. Based on those results, Barrick will consider whether or not an underground exploration program is warranted. During the first nine months of 1988, Queenston reported a loss of $94,064 or 1 per share compared to net income of $614,312 or 6 per share at the same time last year.

The company’s cash position remained relatively steady during the nine month period ended Sept 30 compared to last year. It increased slightly to $1.94 million from $1.92 million.

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