Higher gold prices helped Vancouver-based
The loss was trimmed to $212,000 (or nil per share), from a loss of $1 million (2 per share) in the corresponding period of 2002. Revenue slipped by $500,000, to $3.7 million, whereas cash flow increased to $761,000 from $748,000.
During the first half of 2003, Aurizon incurred a loss of $218,000 (nil per share) on revenue of $7.9 million, compared with a loss of $1.3 million (3 a share) on $8.7 million a year earlier. First-half cash flow fell to $294,000 from $1.3 million.
The second quarter saw Aurizon’s half-share of production from the Sleeping Giant in Quebec fall to 6,873 oz., or 18% less than a year earlier, while the stronger Canadian dollar caused cash costs to jump US$63, to US$301 per oz. The dropoff in production is attributed to a switch to selective mining. The new mining method increased average ore grades by 22% to 12.3 grams per tonne. Mine operating costs fell to $2.9 million from $3.1 million as about half as many tonnes (17,796) were milled.
Attributable production in the first half of the year was 14,545 oz. That’s 21% better than expected but 16.5% lower than in the first half of 2002. Cash costs between the two periods rose 23% to US$279 per oz., while ore throughput slipped, as expected, by 30% to 76,320 tonnes.
Aurizon’s realized gold price for the recent quarter was US$363 per oz., compared with US$302 a year earlier, whereas the first-half price rose to US$355 from US$297.
Production at Sleeping Giant is expected to rebound to historic levels in the second half of the year. Production for all of 2003 is pegged at 30,500 oz. at US$258 apiece.
At present, the shaft is being deepened in order to provide access to deeper reserves and resources. Aurizon is contributing $4 million to the program, which is expected to wrap up in the second half of 2004.
Meanwhile, at the Casa Berardi gold project, 100 km north of Rouyn-Noranda, four drill rigs are testing the eastern extensions of zone 113 and zones 118-120 along the Casa Berardi fault.
During the quarter, the company completed 388 metres of drifting and ramping on its way toward zone 113. The ramp is expected to reach the zone at the 550-metre level in the fourth quarter. Definition drilling will then aim to increase confidence in grade and ore continuity.
The inferred resource in zones 118-120 was recently doubled to 1.7 million tonnes grading 6.1 grams gold, or 331,917 oz. gold, based on a cutoff grade of 3 grams gold per tonne (T.N.M., July 7-13/03). The zones remain open along strike and at depth. The company is investigating the impact the new resources will have on a previously completed feasibility study of the West mine.
To help fund ongoing exploration at Casa Berardi and extend the shaft at Sleeping Giant, Aurizon has inked a bought deal with a group of underwriters led by National Bank Financial. Aurizon will issue 10 million units at $2 apiece. The underwriters have also been granted an option on 1.5 million additional, like-priced units. The option is good until the deal’s closing.
A unit consists of one share and half a warrant; one warrant is good for one share at $2.50 per share for two years. The offering is slated to close by Sept. 10 and has yet to be approved by regulators.
Aurizon recently closed another financing deal, worth $1 million. James Bay Development Corp. (SDBJ) subscribed to a private placement of 740,740 units at $1.35 apiece. One unit consists of one share plus half a warrant. One warrant allows SDBJ to buy one share for $1.60 for two years.
At the end of June, Aurizon had cash and equivalents totalling $11.5 million. The company is debt-free.
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