Vancouver — Lower cash operating costs at its 95%-owned Kemess mine in northern B.C. allowed Northgate Exploration (NGX-T) to post a smaller-than-expected loss during the quarter ended March 31.
“I am delighted with the continuous improvement in operations at Kemess,” says Ken Stowe, Northgate’s president.
The company posted a net loss of $848,000, or 3 per share, on revenue of $42.4 million during the latest quarter. This compares with a net loss of $2 million, or 7 per share, in the corresponding period of 2000.
Production at the Kemess operation tallied 73,360 oz. gold and 18.6 million lbs. copper. Cash operating costs over the year averaged US$165 gold per oz., net of byproduct credits, compared with US$177 per oz. in the first quarter of 2000.
Grades at the mine were significantly higher, coming in at 0.29% copper and 0.93 gram gold, compared with 0.22% copper and 0.78 gram gold a year earlier.
The performance improvements were the results of modifications to the milling circuit and better plant and equipment availability. The installation of a new conventional thickener unit, the overhaul of the filter presses and the addition of an on-stream analysis system all contributed to improving gold-copper concentrate quality. In addition, Northgate says the conversion to handling and transporting the concentrate in bulk is expected to save the company $4 million per year in freight costs.
On the exploration front, drill programs at Kemess North increased the mineral inventory by an estimated 3.5 million oz. gold and 1.2 billion lbs. copper. Kemess North is 5.5 km north of the South pit, which is currently being mined.
A 12-hole, 4,100-metre program of diamond drilling was completed last year and resulted in the discovery of a copper-gold porphyry dome. This expanded the original Kemess North resource to 360 million tonnes grading 0.154% copper and 0.3 gram gold per tonne. Previous estimates (calculated in 1998) pegged the deposit at 74 million tonnes grading 0.18% copper and 0.34 gram gold.
This year, Northgate has budgeted for a $500,000, 10-hole drill program to delineate Kemess North. Beginning in July, drilling will test along strike and to depth at the newly discovered porphyry system, focusing on the northeastern section of the dome.
This year, Kemess is expected to crank out 257,000 oz. gold and 70 million lbs. copper at a cash operating cost of US$170 per oz., net of byproduct credits.
Be the first to comment on "Northgate trims losses"