STOCK MARKETS — Curragh seeks protection of courts, shares

No longer able to service its substantial debts, Curragh took shelter from its creditors during the week ended April 6.

The zinc miner’s filing for court protection may signal the death of a company that, when it listed at $10 in 1990, was the western world’s sixth-largest producer of lead and zinc concentrates.

Everything turned sour for Curragh after its Westray coal mine blew up in May, 1992. A protracted period of weak zinc prices has only served to exacerbate the company’s problems.

Since the Westray disaster, Curragh’s shares have tumbled from $5 to a recent 52-week low of 36 cents. Given less than a month to establish an acceptable financial plan or face renewed pressure from creditors who are owed more than $200 million, Curragh slipped another 12 cents to 28 cents today (April 7). From an average of 56 cents per lb. in 1992, zinc has fallen to the 45 cents level and analysts see little hope for recovery before 1992. Copper prices, surprisingly resilient throughout the 1991-92 recession, are also beginning to show signs of weakness. Reacting to sales that began in China and gradually spread to other locales, copper fell to its lowest level in nearly five years on the London Metal Exchange. For our report period, the red metal lost 5 cents to 92 cents.

Richardson Greenshields analyst Raymond Goldie says the sudden sales in China are puzzling in light of the fact that the country has a “fundamental and growing need for the stuff.”

But he adds that China has a tendency to buy and sell in short spurts, often having a dramatic but short-term impact on LME prices. He is sticking to bullish forecasts for the metal.

Rio Algom, soon to become a major copper producer through the development of its Cerro Colorado property in Chile, lost 50 cents to $19.13 on the week. Also about to make a major investment in copper is gold-producer Royal Oak Mines, which is buying a 39.9% interest in Geddes Resources from Northgate Exploration for $10 million. Geddes has a 100% interest in the Windy Craggy copper-gold property in northern Brtish Columbia where reserves stand at close to 300 million tons averaging 1.4% copper.

Royal Oak, which just completed its purchase of the dormant Colomac gold mine in the Northwest Territories, picked up 50 cents to close at $4.75 but lost 30 cents today.

Geddes added 15 cents to 95 cents before losing 9 cents today, while Northgate tacked on 16 cents to $1.11 and added another 4 cents today. Cambior and its major shareholder, Soquem, have concluded an agreement with underwriters for the sale of 10 million units at $14 per unit. Cambior slipped 13 cents to $13.88.

Rumors of a copper find by Granges in Munro Twp., Ont., sent that stock to a new high of $2.45, for a gain of 36 cents. In early 1992, Granges drilled seven holes (or 1,300 metres) on its Potterdoal property east of Timmins, Ont. The stock added another 17 cents today.

But rumors of a major gold intersection that circulated at the recent Prospectors and Developer’s Convention in Toronto are false, say officials at American Barrick Resources. They say the details of the rumored intersection correlate with an old intersection at the Meikle mine in Nevada, where there has been no recent drilling.

Barrick picked up $1.25 to close at $23 on a volume of 4.3 million shares. Also gaining ground during our report period was Agnico-Eagle Mines, up 63 cents to $7. The gold producer continues to pull excellent values from its LaRonde gold mine property and expects to raise up to $50 million through an equity financing.

Taking top spot on the most active list, with almost seven million shares changing hands, Pure Gold Resources added 13 cents to 59 cents. The junior says its Aussie partner, Ashton Mining, has determined, through microprobe analysis, that the pyrope garnets collected at the Humpy Lake property in the Northwest Territories are derived from diamondiferous bodies. In other diamond developments, Lytton Minerals is planning to raise another $4.5 million through a private placement with European investors. The company is said to be meeting with considerable success on its diamond property north of Lac de Gras, N.W.T.

Partners SouthernEra Resources and Aber Resources, along with VSE-listed Commonwealth Resources, were expected to begin drilling on their properties April 9. SouthernEra lost 5 cents to $4.85 while Aber added 18 cents to $2.43.