Campbell cuts western gold at Joe Mann

Campbell Resources (CCH-T) has completed six holes from the fourth of four drilling stations on a 600-metre exploration drift driven at level 2925 west of the production shaft at the Joe Mann mine in Quebec.Five of the holes cut a gold-bearing quartz vein running 1.5-7 metres wide, with four of the holes yielded economic grades, including some visible gold. The holes also cut sub-economic and economic grades in two other veins. Results are as follows:

• Hole EW-28 cut 2.6 metres averaging 24.3 grams gold per tonne starting at a down-hole depth of 130.3 metres.
• Hole EW-28A cut 1.7 metres of 0.5 grams gold starting at 130.5 metres down hole.
• Hole EW-29 returned 2.1 metres of 19.3 grams gold at 130.5 metres down hole.
• Hole EW-30 yielded 3.9 metres grading 31.5 grams gold at 126.6 metres down hole.
• Hole EW-31 cut 1.6 metres of 8.2 grams gold 142.5 metres.
• Hole EW-32 returned 6.5 metres averaging 12.1 grams gold, including 2.4 metres of 24.6 grams gold.

Campbell says the holes have outlined the vein for up to 137 metres of strike length along the horizontal extension of the main zone.

Previously, 26 holes sunk from the first three stations spotted 150 metres apart, indicated gold-bearing structures, but returned mostly sub-economic grades from the western extension of Joe Mann’s main vein. The best hole of that batch returned 34.7 grams gold over 0.46 of a metre.

Pending positive results from continued drilling, a 140-metre drift could be developed in the second half of the year to provide access to mineralization from level 2925.

Campbell recently posted a first-quarter loss of $2 million (or 4 per share) on revenue of $4.6 million, compared with a year-ago loss of $691,000 (2 a share) on nil revenues from metal sales (as mining operations at the Joe Mann Mine were suspended from November 2000 until April 2002).

Quarterly gold production from Joe Mann tipped the scales at 11,370 ounces (400 ounces off budget); 201,000 lbs. of copper were also produced (6,600 lbs. over budget). Cash operating costs came in at US$349 per oz., while the company realized US$345.48 for each ounce produced.

The company expects to churn out 54,000 ounces of gold and 900,000 lbs. of copper during all of 2003.

Earlier this year, Campbell inked a deal with Rocmec International to test a thermal-fragmentation technique on some ore blocks at Joe Mann to see if narrower structures, currently uneconomic at the mine, can be mined that way. If applicable, Campbell figures the new method could increase reserves and resources and significantly reduce costs.

Investors were unimpressed with the drill results, sending the shares 3.5, or 7.3% lower, to 44.5 in late afternoon trade in Toronto on May 27.