Aurizon turns to Casa Berardi for growth

Aurizon Mines (ARZ-T) continued to pile up losses during 2001 as it wound down existing operations and turned its attention to developing the promising Casa Berardi project in nortwestern Quebec.

For 2001, Aurizon posted a net loss of $6.1 million (16 per share) on revenue of $14.6 million, compared with a loss of $8.4 million (22 per share) on revenue of $24.4 million in 2000.

The 2001 results include a $1.1-million writedown on mining assets plus $3.1 million in care-and-maintenance costs at Casa Berardi and the Beaufor mine, also in Quebec.

Aurizon’s share of gold producton from the Sleeping Giant mine, north of Val d’Or, Que., was 31,929 oz., compared with 38,980 oz. in 2000. The decline is due to the double whammy of a 13.5% drop in ore grade to 9.6 grams gold per tonne and a 3% decline in milling to 214,000 tonnes. Not surprisingly, total cash costs rose 24% between the two periods to US$236 per oz. The mine is equally owned with operator Cambior (cbj-t).

Overall, Aurizon’s share of gold production fell to 31,900 oz., from 56,100 oz. a year earlier. The decline is attributed to the sale of the company’s Beaufor mine to Richmont Mines (RIC-T). Aurizon realized a gold price of US$276 per oz. for its 2001 production, down US$11 from 2000.

For 2002, Aurizon expects Sleeping Giant to deliver 36,000 oz. gold to its account as ore grade improves at the mine.

The company ended 2001 with working capital of $1.2 million and long-term debt of $4.2 million. An outstanding $4-million payment to Casa Berardi-vendor TVX Gold (TVX-T), originally due in 2001, was extended to August 2003.

In April 2002, Aurizon replenished its coffers with a $5-million equity financing. The funds should provide enough working capital to meet medium-term operating and exploration commitments, which include renewed drilling at Casa Berardi.

In early 2000 at Casa Berardi, Aurizon completed a technical and economic evaluation of the resource base of the West Mine area, and established proven and probable reserves of 6.9 million tonnes grading 6.7 grams per tonne, for 1.5 million contained ounces.

Aurizon’s share price has been on a tear since the new year began, jumping from the low 20 range to well above 84 at presstime.

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