Query Diepdaume update

I am writing to enquire on the status of Diepdaume Mines, a company controlled by Mr Patrick Sheridan, which holds property located directly adjacent to that owned by Associated Porcupine.

I purchased shares of Diepdaume Mines (the former Preston East Dome property) on the basis of the statement in the 1983 annual report that production was expected in early 1984. That report stated, “an in-depth study of the previous underground workings, together with underground examination and surface drilling has indicated sufficient tonnage of ore to operate the mine for a number of years.”

I further understand that the company has more than doubled its outstanding shares by way of flow- through placements since my original purchase.

Since the company had sufficient ore to warrant production in 1983, I am at a loss to understand why a large dilution factor was necessary or in the shareholders’ interest. Surely profits from the mine and custom milling (referred to in the 1983 report) would have provided the funds raised by flow-through shares.

Could you please inform me of the current production plans of the company? S.F., Toronto, Ont.

You are correct in noting that Diepdaume Mines (VSE) has been workin g for several years now with the hope of reviving the former Preston East Dome property in the Porcupine gold camp near Timmins, Ont.

The company has been in the process of dewatering the old mine shaft, and at last report, had reached the 800-ft level. One problem encountered, however, has been continuing water inflow from lakes and adjacent properties, such as the old Paymaster (which is, as you say, controlled by Associated Porcupine (TSE) and American Reserve (VSE)). The underground workings on the adjacent properties of Diepdaume and Associated Porcupine are connected at the 2,400-ft level, which explains why any attempt by one company to dewater is affected by the other.

As reported earlier, (N.M., Dec 5/88) Associated Porcupine and American Reserve are planning to rehabilitate the old Paymaster shaft and, by using big pumps, are expecting to reach the 2,000-ft level in short order. At year-end, Associated Porcupine reported it had dewatered to a depth of 250 ft.

Diepdaume Mines’ president, Patrick Sheridan recently told The Northern Miner that his company is still actively working on the former gold mine. “The Timmins project is not dead at all,” he said. “We’re planning to take bulk samples in the near future.”

Sheridan said the company has finished building its mill, and has been custom milling ore at the plant for some time now.

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