MINING MARKETS & INVESTMENT NEWS — EASTERN MARKETS — Royal Oak approaches day of reckoning

The precious and base metals markets were relatively quiet during the holiday-shortened March 31-April 6 report period, with the biggest change seen in gold prices, which rose 45 cents to US$280.25 per oz. on the London morning fix of April 7.

Canada’s major gold producers had a mixed week: Barrick Gold was up 40 cents to $25.20; Kinross Gold was off 5 cents to $2.97; Cambior slipped 25 cents to $5.75; TVX Gold lost 8 cents to slide to $1.80; and Placer Dome rose 15 cents to $16 as the major completed its US$235-million acquisition of a half-interest in South Africa’s Western Areas, which will develop and operate South Deep and operate the existing South Shaft mine.

Royal Oak Mines ended the report period at 10 cents, down 4 cents. On April 1, an Ontario court judge gave Royal Oak Mines two weeks to come up with a last-ditch plan to avoid bankruptcy. As well, the Toronto Stock Exchange announced it would remove Royal Oak from the TSE 300 Composite Index effective before the April 16 opening.

Among the base metal majors, Boliden has shown strength of late, rising 30 cents to $2.20 as the miner announced it would reopen the Los Frailes zinc-silver mine in Spain, a year after the infamous tailings dam failure.

Other majors showed little movement: Inco lost 15 cents to hit $19.70; Falconbridge remained unchanged at $16; Rio Algom rose 35 cents to $15.85; Teck’s B shares were unchanged at $10.60; and Cominco regained lost ground, rising $1.45 to $21.10.

In the junior markets, formerly moribund American Gem raised eyebrows by becoming volume leader and soaring 14 cents to 18 cents. The Montana-based company announced plans to sell sapphires and related jewellery over the internet.

Monarch Resources was up 16 cents to 34 cents as it announced the selling of its La Camorra gold mine in Venezuela to Idaho-based Hecla Mining for US$28 million in cash and shares.

Bouncing back from oblivion, South American Gold & Copper rose 4 cents to 8 cents as the junior made three announcements: the refinancing of $4 million in debentures; the private placement of up to $1.5 million at 5 cents per share; and the extension to December 2000 of US$2 million due on its Pimenton gold property in Chile.

In another good week, Scorpion Minerals rose 32 cents to 78 cents. In late February, Scorpion entered into a joint venture with Australian producer Aurora Gold on the former’s Sampanahan property in southeastern Kalimantan, Indonesia. By spending US$6 million on exploration and paying Scorpion a further US$1 million, Aurora will earn 75% of Scorpion’s 85% interest in PT Scorpion Sampanahan Mineral, which holds a 100% interest in the Sampanahan contract-of-work. Aurora has budgetted US$1 million for exploration at Sampanahan this year and will assume operatorship of the project.