Silver Standard maintains British Columbia efforts (March 07, 1988)

With major programs completed on several of the company’s properties, 1987 was a busy year for Consolidated Silver Standard Mines, shareholders learned at the annual meeting. Approximately $1 million was spent on various projects, $280,000 of that by the company itself.

Robert Quartermain, president, noted that a new gold zone was discovered by Freeport-McMoRan at the Tuscarora property in Nevada. The discovery is expected to add to existing geological reserves of 1.2 million tons grading 0.16 oz gold and heap leachable reserves of 311,500 tons averaging 0.039 oz. The company has a 2.2% net smelter interest in the property and with its joint venture partners receives $100,000 in advance royalties.

A modest income was realized from Silver Standard’s four leased properties in Central British Columbia including the Duthie mine property where Bishop Resources completed a $120,000 underground program prior to recommending production at the 50-ton-per-day facility.

Erickson Gold Mines funded a 2,600-ft drill program on Silver Standard’s Hunter property in the Cassiar mining camp of northern B.C. A new vein (the Teresa) was discovered which returned chip samples up to 62 oz gold across 2.8 ft. Also in northern B.C., Longreach Resources drove a 215-ft adit on Silver Standard’s Paydirt property and carried out underground drill te sting of a gold-bearing zone which contains drill-indicated reserves of 200,000 tons grading 0.12 oz. More work is planned this year.

The company has a working capital of $1.5 million and $535,000 in marketable securities so is well positioned to take advantage of new opportunities, the meeting was told.

In 1988, Consolidated Silver Standard intends to increase the tempo of its exploration activities through participation in new ventures and the revitalization of its existing properties. With 1987 revenues exceeding administration costs, $1.5 million in unallocated working capital and $535,000 in marketable assets, the company is well positioned to take on attractive new opportunities. Last year, the company spent $280,000 on exploration, although with funding from its joint-venture partners, that figure actually totalled $1 million.

In Canada, the company’s activities were concentrated in northern British Columbia. On the Hunter property in the Erickson gold camp, Erickson Gold Mines funded a 2,600-ft drill and surface exploration program as part of its option to earn a 60% property interest. Work will continue on the newly discovered Theresa vein, from which chip samples assayed up to 62 oz of gold per ton across 2.8 ft.

On the Paydirt property in the Porcupine River watershed, Longreach Resources drove a 215-ft adit and carried out underground drill testing of a gold-bearing zone containing drill-indicated reserves of 200,000 tons grading 0.12 oz gold per ton. Longreach can earn a 50% property interest, subject to certain back-in rights retained by Teck Corp. by spending $700,000 over three years.

Drilling by Whitesail Minerals on the Smith claim, 40 miles southeast of Kitimat, intersected 0.396 oz of gold per ton across 2.5 ft in the 700-ft-long Smith-Nash vein. Whitesail is earning a 50% property interest by spending $500,000 over four years.

The company has a 10% working interest in two grassroots gold plays along with two other Vancouver- based companies. Chip samples from one of seven veins on the B.J. property assayed up to 0.883 oz gold per ton over 5 ft. On the Castle property, gold values range up to 4.03 oz in grab samples and 0.93 oz of gold per ton over 3 ft in chip samples. Teck, as operator, will drill-test these properties in 1988.

In central British Columbia the company continued underground exploration of the Mamie property, 14 miles west of Smithers. The property has geological resources of 60,000 tons grading 0.32 oz of gold with silver, copper and zinc credits and room for expansion of this reserve. The company will undertake an exploration program in 1988 on the Blue Ice claims in Wells Grey Park. Previous drilling intersected values of 1.55 oz of gold per ton across 15 ft in sulphides replacing limestone.

Elsewhere, the company continued work on its Yukon rare earth property which has values up to 3% rare earths and 1% yttrium in grab samples. The company participated in a grassroots platinum exploration syndicate in British Columbia, financed a gold-prospecting venture in northern Manitoba and acquired ground in Quebec covering known rare earth occurrences.

On the Tuscarora property in Nevada, Freeport-McMorRan Gold Co. discovered a new zone at Mill Creek which will add to the geological reserves of 1.2 million tons grading 0.158 oz gold per ton with an additional 311,500 tons of heap- leachable material grading 0.039 oz gold per ton * The company has a 2.19% net smelter interest in the property and, with its joint venture partners, receives $100,000 per annum in advance royalties.

The company received a modest income from net smelter royalty interests it retains in four leased silver properties in central British Columbia Bishop Resources Development Corp. has completed a $120,000 underground program on the Duthie property prior to recommencing production at the 50-ton- per-day facility.

Associated companies Lord River Gold Mines (30%) and Mutual Resources Ltd. (29%) were both active in 1987. Lord River and its joint-venture partner, Cathedral Gold Corp., carried out a $450,000 drill and underground program on the Pellaire property, 100 miles north of Vancouver, to increase the previously defined geological reserve of 34,000 tons grading 0.67 oz gold per ton. Mutual Resources, with $900,000 in its treasury, was amply funded to carry out two exploration programs: one on its bre claims adjacent to City Resources’ Cinola gold deposit on the Queen Charlotte Islands and the other on the Gem Lake property in southern Manitoba which is optioned from Canhorn Mining Corp.

In 1988, Consolidated Silver Standard intends to increase the tempo of its exploration activities through participation in new ventures and through the revitalization of its existing properties. With 1987 revenues exceeding administration costs ($1.5 million in unallocated working capital and $535,000 in marketable assets), the company is well positioned to take on attractive new opportunities.