Bema gets squeezed by senior partners

Although gold prices remained below US$267 per oz. during the Nov. 8-15 report period, there was a steady stream of news from both major and junior gold companies.

Down 5 to 41, Vancouver-based Bema Gold had a particularly rough week, as partner and operator Kinross Gold unilaterally halted mining operations at their equally owned, low-grade Refugio open-pit mine in Chile. Bema disputes Kinross’s right to make this decision without its approval. Kinross closed at 65, down 4.

In a second blow to Bema, Placer Dome said its US$1.3-billion Cerro Casale low-grade gold-copper project in Chile is on hold until gold prices improve. Placer, which dropped 70 to $12.15, has a 51% stake in the project, with the remainder controled by a group led by Bema and CDNX-listed Arizona Star Resource.

Bema is still active at its 79%-owned Julietta high-grade gold-silver project, in far-eastern Russia, where mine construction and development work are under way. Bema’s Russian subsidiary secured a key US$35-million project loan in late September.

Among Canada’s remaining gold majors: Barrick Gold fell 40 to $20.60; Franco-Nevada Mining slipped 70 to $13.15; TVX Gold declined 8 to $2.31 as it announced third-quarter net earnings of $5.1 million; and Cambior fell 2 to 44.

Several gold juniors had news to report: Campbell Resources fell 19 to 57 as it suspended mining at its troubled Joe Mann gold mine in Quebec; McWatters Mining was unchanged at 26 as it completed a $3-million, convertible-debenture financing; gold explorer Chesbar Resources, falling 6 to 21, reported positive results from test pits at its Buena Vista nickel-laterite project in Honduras; and Rio Narcea was down 13 to 60 and was trading at 41 at presstime after reporting currency-related losses of US$2 million during the first nine months of 2000 at its Spanish gold mine.

With prices for nickel, copper and zinc sagging slightly, most of Canada’s base metal majors declined: Inco dropped 5 to $22.95; Falconbridge fell 30 to $17.55; Sherritt International eased down 15 to $4.25; Noranda was unchanged at $14.85; Teck‘s B shares shed 40 to reach $11.25; Cominco was down $1.30 to $18.10; and Breakwater Resources was unchanged at $1.75. Only Boliden advanced, jumping 24 to hit $1.30 on no news.

First Quantum Minerals shot up 35 to $3.15 as the company announced it had given Billiton the right to earn a majority interest in portions of its Mwinilunga or Luamata prospecting licences in Zambia in exchange for US$2.4 million in exploration funding. Billiton also made a small private placement in First Quantum, with proceeds earmarked for exploration.

Continued takeover speculation added some sparkle to the diamond juniors, with Dia Met Minerals‘ B shares climbing $1.20 to $22.45 and Aber Diamond rising 20 to $13.90.