White mine’s output up but operating costs rise

Dickenson increased its ownership in the mine from 66% to 100% in June last year when it bought out project partner Cambior Inc. (TSE). Because of the partnership arrangement in effect during the first half of 1988, Dickenson claimed a proportionate output share of 60,000 oz last year.

Operating costs for the mine last year averaged $347(US) per oz, compared with $321 for 1987. Last year’s operating costs include expenses for a 27% increase in underground development work; fourth- quarter costs averaged $289 compared with third-quarter costs of $334 and first-half costs of $393.

Mine production for 1989 is projected to be 82,000 oz at an average operating cost of $309.

The company says underground development results indicate the mine is capable of producing 90,000 oz annually beginning in 1990.

Dickenson reports it has hedged the majority of its 1989 projected gold production at about $430 per oz.

Net earnings in 1988 were reported to be $6.1 million on revenues of $46.5 million, with a year- end cash balance of $11.2 million. Ore reserves

Proven and probable reserves at the end of 1988 stood at 3.3 million tons grading 0.32 oz gold per ton, unchanged from year-end 1987 after the company mined 259,000 tons at 0.31 oz.

During 1988, Dickenson reports obtaining excellent results in the South C zone adjacent to an altered rock nose in quartz carbonate visible gold ore structures. Among the assays were 5.04 oz over 2.8 ft, 0.78 oz over 10 ft and 1.1 oz over 12.8 ft. This new zone may be an extension of the P zone of the adjacent Campbell mine.

In the J zone, drilling outlined visible gold in a nugget pipe structure close to the Campbell boundary where an assay of 3.17 oz over 50.2 ft w as recorded.

On the 26-level, a drift was driven in the hangingwall zone to follow up a drill hole intersection of 2.43 oz over 18.5 ft. Subsequent drilling returned sections of 1.49 oz over 26.5 ft, 0.4 oz over 25 ft and 0.66 oz over 20 ft.

On the 30-level, drilling on the quartz carbonate zone indicates the mineralization is continuous below the level. Results to date include 0.66 oz over 6.33 ft and 3.64 oz over 14.4 ft.

Meanwhile, in South Dakota, at the heap leach operation run by Wharf Resources (TSE), output for 1988 totalled 59,500 oz compared with 46,000 oz in 1987. Direct gold production costs last year averaged $175 per oz compared with $189 for 1987.

For 1989, Wharf, in which Dickenson has a 34.7% equity interest, is projecting output of 71,000 oz at an operating cost of $188. Project reserves at the end of 1988 stood at 25.3 million tons grading 0.037 oz.

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