Higher gold production a Lac highlight

With 199,057 oz of gold produced so far this year, Lac Minerals is more than two-thirds of the way in meeting its targetted gold production of 290,000 oz by year-end, excluding production from the Page-Williams claims.

The major contributor to the targetted gold production figure will be the Doyon gold mine in northwestern Quebec, held in joint venture with Cambior Inc., Belle Mulligan, Lac vice-president of investor relations tells The Northern Miner.

This year Doyon is expected to produce 210,000 oz of gold, of which Lac will net 105,000 oz. So far, this year Lac’s share of the production from Doyon amounts to 76,486 oz of gold, up 16% from the 65,775 oz produced in the same period last year.

Production of 70,000 oz of gold is expected from the Bousquet mine, near Noranda, Que. this year. So far, 46,492 oz of gold have been produced, with only 8,997 oz produced this quarter. Production was down, explains Ms Mulligan, while underground stoping areas were being developed and ore was being stockpiled. Now that this has been completed, fourth quarter production will pick up, she says.

Meanwhile drilling on the two new zones of gold mineralization on the eastern section of the Bousquet property is just finishing up, Ms Mulligan says.

Production at the Macassa mine in the Kirkland Lake area of Ont. is up 4% at 42,741 oz over the production in the same period last year. About 60,000 oz is expected to be produced at the mine this year. Production from the Lakeshore so far this year amounts to 9,303 oz, while 24,001 oz of gold have been produced from the Hemlo fractions. Looking at the total, the company produced 199,057 oz of gold for the nine months ended Sept 30. This fig ure includes production from the Hemlo fractions, but excludes production from the Page- Williams claims. If the latter is included, the figure jumps to 364,532 oz of gold. In the same nine-month period last year 195,780 oz of gold were produced.

Lac’s figures for 1985 do not include the Page-Williams as commercial production of the mine did not start until Jan 1 of this year. And this year the company is presenting its operating and financial results with and without the Page- Williams operation. The recent court judgment which transferred the mine to International Corona is under appeal by Lac with hearings scheduled to start Nov 17.

Without the Page-Williams operation, earnings for the third quarter were $5 million, or 18 cents a share, an improvement over the $4.1 million after extraordinary items, or 15 cents per share posted in the same quarter of 1985. Before extraordinary items, third quarter earnings in 1985 amounted to $40,000.

However, earnings almost triple to $14 million or 50 cents per share in this year’s third quarter once the Page-Williams is included.

Third quarter revenues this year amount to #37.8 million without the Page-Williams operation, and $76.9 million with the Page-Williams. Third quarter revenues in 1985 were $34.4 million.

Looking at the year to date, earnings come in at $6.4 million or 23 cents per share on revenues of $99.7 million, excluding Page-Williams and with no extraordinary items reported. Once Page-Williams is included, however, earnings run up to $18.8 million or 67 cents per share on revenues of $188.8 million.

In the nine-month period of 1985, earnings before extraordinary items were $11.8 million or 44 cents per share and $15.9 million or 59 cents after extraordinary items on revenues of $109.8 million.

The contributions to earnings by the Hemlo fractions were 11 cents per share for the current nine month period and 6 cents per share for the three months ended Sept 30.

Cash flow from operations for the current nine-month period are $63.5 million or $2.25 per share. Without the Page-Williams, cash flow from operations dips to $24.5 million or 87 cents per share.

For the three months, cash flow from operations was $35 million or $1.24 per share. Excluding Page- Williams, cash flow drops to $13.2 million or 47 cents per share.

Cash flow in the 1985 nine- month period was $38.3 million or $1.43 per share. For the three month 1985 period cash flow was $4.8 million, or 18 cents per share.