MINING MARKETS & INVESTMENT NEWS — EASTERN MARKETS — Base metal majors buoyed by copper prices

Copper was the big story during the June 30-July 6 report period, with prices shooting up 5 cents, to 75 cents per lb., in response to a series of cutbacks in copper mining and smelting operations in the southwestern United States.

Copper’s rise provided a welcome lift to many of Canada’s biggest base metal producers: Noranda was up 25 cents to $19.45; Rio Algom gained $1.15 to $21.15; and Teck’s B shares rose $1.60 to close at $13.10.

The three companies are celebrating the signing of a US$1.32-billion financing for their joint-ventured Antamina copper-zinc-molybdenum project in Peru. Rio Algom also announced a 100-million-tonne, or 33%, increase in the size of its Spence copper deposit in Chile and a 67% rise in Spence’s projected annual copper production to 500 million lbs.

The other base metal majors fared well over the period: Cominco climbed $1.20 to $25.30; Inco gained 5 cents to $26.15; and Falconbridge eased up 65 cents to $21. Boliden, which restarted milling operations at the Los Frailes zinc mine in Spain, gained 7 cents to reach $3.50. Junior copper producer Aur Resources saw heavy trading, rising 10 cents to $2.84.

The news was not so rosy for the precious metals, with gold prices diving $4.60 over the week to another 20-year low of US$256.20 per oz. on the London morning fix of July 7. Most of the loss occurred on July 6, when the Bank of England began its controversial auctioning of a portion of its gold reserves.

Most of Canada’s major gold producers showed declines: Barrick Gold was down 5 cents to $27.15; Placer Dome dropped $1.50 to $16.10; and TVX Gold lost 12 cents to close at $1.28. Kinross Gold was unchanged at $2.38;

Buffered by its base metal production, only Cambior bucked the trend, rising 25 cents to $4.95.

The most active diamond junior was Tahera, which gained 2 cents to 14 cents. With positive drill results in hand from the Contwoyto-1 kimberlite at the company’s Jericho project in Nunavut, Tahera is proceeding with a mini-bulk sampling program that will determine grade.

Red-hot explorer Manhattan Minerals gained another 70 cents to reach $7.05 as the company announced that drilling into a previously untested anomaly intersected massive sulphides. The first hole drilled into target TG-3 intersected 42.3 metres grading 1% copper, 1% zinc and 0.1% lead, plus 1.11 grams gold and 29 grams silver per tonne.

Pan American Silver, which closed down 25 cents to $8.50, announced that site construction is under way at the past-producing Dukat silver mine in far eastern Russia. Renewed production is scheduled for the second quarter of 2000. Project loans totalling US$60 million will be provided primarily by the World Bank’s International Finance Corp. and the Export Development Corp. of Canada.